Assume Clean Motors Ltd Manufactures Only One Component for the Motor

question 37

Multiple Choice

Assume Clean Motors Ltd manufactures only one component for the motor vehicle industry.In one year the company produced 25 000 units of the component of which 22 000 units were sold.The following costs were recorded for that year:
$\begin{array}{lr}\text { Direct material } & \$ 750000 \\ \text { Direct labour } & 450000 \\ \text { Manufacturing overhead } & 300000 \\ \text { Administrative expenses } & 84000\end{array}$
If there were 5000 units in beginning inventory,calculate the cost of sales for Clean Motors Ltd for that year.

• A) $1 620 000
• B) $1 800 000
• C) $1 500 000
• D) $1 320 000

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