Lee Company Produces a Single Product

question 20

Multiple Choice

Lee Company produces a single product. At the end of last year, the company had 30,000 units in its ending inventory. Lee's variable production costs are $10 per unit and its fixed manufacturing overhead costs are $5 per unit every year. The company's net operating income for the year was $12,000 higher under variable costing than under absorption costing. Given these facts, the number of units of product in inventory at the beginning of the year must have been:

• A) 28,800 units
• B) 27,600 units
• C) 32,400 units
• D) 42,000 units

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Definitions:

Legislative Acts

Laws or statutes that have been formally enacted by a legislative body, such as a parliament or congress.

Townshend Acts

A series of laws passed by the British Parliament in 1767, imposing taxes on the American colonies for items like tea, glass, and paper.

Increase Revenues

refers to strategies or actions undertaken by a company or organization to boost the amount of money generated through its business activities.

Parliamentary Control

A system wherein the functioning and decision-making of government are overseen and directed by a parliamentary body.