Cutterski Corporation manufactures a propeller. Shown below is Cutterski’s cost structure:
|
|
Variable |
Total fixed |
|
|
cost per |
cost for the |
|
|
propeller |
year |
|
Manufacturing cost |
$114 |
$810,000 |
|
Selling and administrative |
$20 |
$243,000 |
In its first year of operations, Cutterski produced 60,000 propellers but only sold 54,000.
What is the total cost that would be assigned to Cutterski”s finished goods inventory at the end of the first year of operations under the variable costing method?
A) $765,000
B) $684,000
C) $804,000
D) $912,000