Queen Sales, Inc. has just completed its first year of operations. The company has not had any
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 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
Balance SheetBalance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
Step by Step Answer:
Choice b is correct Absorption costing which is required under US GAAP requires all product costs t...View the full answer
Horngrens Cost Accounting A Managerial Emphasis
ISBN: 978-0134475585
16th edition
Authors: Srikant M. Datar, Madhav V. Rajan
