Coastal Corporation, Which Uses Throughput Costing, Began Operations at the Start

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The Answer is A.

\begin{array} { l r } ext { Direct materials } ( 20,000 ext { units } imes ~ \$ 18 ) & \$ 360,000 \ ext { Direct labor } & 160,000 \ ext { Variable manufacturing overhead } & 280,000 \ ext { Fixed manufacturing overhead } & 340,000 \ ext { Selling and administrative costs } & 430,000 \ ext { Total } & \$ 1,570,000\end{array}

B. The year-end inventory of 2,500 units (20,000 - 17,500) is costed as follows: $A. \begin{array} { l r } ext { Direct materials } ( 20,000 ext { units } imes ~ \$ 18 ) & \$ 360,000 \ ext { Direct labor } & 160,000 \ ext { Variable manufacturing overhead } & 280,000 \ ext { Fixed manufacturing overhead } & 340,000 \ ext { Selling and administrative costs } & 430,000 \ ext { Total } & \$ 1,570,000 \end{array} B. The year-end inventory of 2,500 units (20,000 - 17,500) is costed as follows: C. The total costs would be allocated between the current period's income statement and the year-end inventory on the balance sheet. Thus: Absorption costing: $1,570,000 - $142,500 = $1,427,500 Variable costing: $1,570,000 - $100,000 = $1,470,000$ C. The total costs would be allocated between the current period's income statement and the year-end inventory on the balance sheet. Thus:
Absorption costing: $1,570,000 - $142,500 = $1,427,500
Variable costing: $1,570,000 - $100,000 = $1,470,000

Coastal Corporation, Which Uses Throughput Costing, Began Operations at the Start

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