Question: Queen Sales, Inc. has just completed its first year of operations. The company has not had any sales to date. Queen has incurred the following

Queen Sales, Inc. has just completed its first year of operations. The company has not had any sales to date. Queen has incurred the following costs associated with its production as of December 31, Year 1:

Direct materials ................................... $45,000

Production labor...................................35,000

Bookkeeper salary ................................28,000

Factory utilities ...................................18,500

Office rent .........................................12,000

Factory supervisor salary ........................ 9,600

Machine maintenance contract .................. 7,500

Under absorption costing, what is the inventory amount shown on the balance sheet at December 31, Year 1?

a. $155,600

b. $115,600

c. $98,500

d. $80,000

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