Canmore Company Has the Following Data Pertaining to 2016

question 139

Multiple Choice

Canmore Company has the following data pertaining to 2016: Factory overhead rate is 125 percent of direct labor costs.
What is the ending materials inventory balance for Canmore in 2016?

• A) $50,000
• B) $62,500
• C) $12,500
• D) $37,500

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Definitions:

Cash Sales

Transactions where goods or services are exchanged immediately for cash, without the extension of credit.

Account Sales

A detailed report provided by a consignee or an agent to the consignor detailing the sale of consigned goods, including prices obtained and associated costs.

Permanent Account

An account in the general ledger that is not closed at the end of the accounting period, with its balances carried over into the next period.

Temporary Account

A temporary account is an account that is closed at the end of each accounting period, with its balances transferred to permanent accounts, used to track revenues, expenses, and withdrawals during the period.