At the Time of His Death,Trent Owned Some Common Stock

question 58

Multiple Choice

At the time of his death,Trent owned some common stock. The Aqua Corporation stock is sold by the executor of the estate seven months after Trent's death for $1,300,000.If the alternate valuation date is properly elected,the value of Trent's estate as to these stocks is:

• A)$2,300,000.
• B)$2,400,000.
• C)$2,500,000.
• D)$2,700,000.
• E)None of the above.

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Definitions:

Manufacturing Overhead

All manufacturing costs other than those accounted for as direct labor and direct materials. Includes indirect costs such as maintenance, utilities, and rent in the production process.

Indirect Materials

Materials used in the production process that cannot be directly linked to specific products, such as lubricants and cleaning supplies.

Direct Materials Cost

The cost of raw materials and components used directly in the manufacturing of a product.

Schedule Of Cost Of Goods Sold

A schedule that contains three elements of product costs—direct materials, direct labor, and manufacturing overhead—and that summarizes the portions of those costs that remain in ending Finished Goods inventory and that are transferred out of Finished Goods into Cost of Goods Sold.