Before the Application of Overhead Costs James & Fraser Ltd $$\begin{array} { c c c } & \text { Direct materials } & \text { Direct labour } \\\text { Charged to production } & \$ 60000 & \$ 80000\end{array}$$

question 55

Multiple Choice

Before the application of overhead costs James & Fraser Ltd has the following costs traced to production:
$$\begin{array} { c c c } & \text { Direct materials } & \text { Direct labour } \\\text { Charged to production } & \$ 60000 & \$ 80000\end{array}$$ Assuming that overhead is applied at the rate of 60% of direct labour cost what is the amount of inventory finished for the period? Assume no work in process.

• A) $80 000
• B) $140 000
• C) $176 000
• D) $188 000

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