Lorillard Corporation Has the Following Information for April, May, and June

question 49

Multiple Choice

Lorillard Corporation has the following information for April, May, and June 2016: Production costs per unit (based on 12,500 units) are as follows:
There were no beginning inventories for April 2016, and all units were sold for $50. Costs are stable over the three
Months.
What is the May ending inventory cost for Lorillard Corporation using the variable costing method?

• A) $182,812.50
• B) $187,500
• C) $312,500
• D) $162,500

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Definitions:

Fiscal Year

A 12-month period used for accounting and financial reporting purposes, which may or may not align with the calendar year.

Alternative Financing Plans

Various funding options available to a business beyond traditional bank loans, including leasing, factoring, and crowdfunding.

Earnings Per Share

A measure of a company's profitability, calculated by dividing net income by the number of outstanding shares.

Estimated Income Tax

The amount of tax a company or individual estimates to owe for the current tax year, often paid in advance through quarterly payments.