In the Klein Company, 50,000 units are produced and 40,000 units are sold. Variable manufacturing costs per unit are $8 and fixed manufacturing costs are $160,000. The cost of the ending finished goods inventory under each costing approach is:
|
Absorption |
Variable |
|
|
Costing |
Costing |
|
|
a |
$112,000 |
$ 80,000 |
|
b. |
112:000 |
‘100,000 |
|
c. |
120:000 |
80,000 |
|
d. |
120,000 |
‘100,000 |