A Manufacturing Company That Produces a Single Product Has Provided

question 14

Multiple Choice

A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations: What is the total period cost for the month under absorption costing?

• A)$48,000
• B)$275,100
• C)$86,400
• D)$188,700

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Definitions:

Inventory

Items of value held by a company for the purpose of sale or production, including raw materials, work-in-progress, and finished goods.

Lost Sales

Revenue that a company could have earned but didn't because of not having enough stock, closing an order, or other reasons.

Merchandise Inventory

Refers to the goods a company holds for the purpose of selling them to customers. It is considered a current asset on the balance sheet.