In 2007, Terry Inc. provided the following items in their footnotes. Their cost of goods sold was $22 billion under FIFO costing

Response:

The correct choice is (c)

Clarification:

Given:

The balance in Sue's account before any spending is $899.83

Expenses include:

Rent = $353.76

Video game = $32.79

Bike maintenance = $60.26

Jacket = $55.62

Rug = $80.40

Night out = $35.77

Total expenses amount to 353.76 + 32.79 + 60.26 + 55.62 + 80.4 + 35.77

                          = $618.60

Remaining in the account after these transactions = 899.83 - 618.60

                                                                                               = $281.23

Sue's share towards the TV cost = $305.22

If she proceeds with purchasing the TV, her balance would drop below zero by $23.99 (281.23 - 305.22) since she wouldn't have enough left to cover the TV's price.

Answer:

Materials inventory on December 1 recorded at $9,900

Direct Labor recorded at $40,040

Factory Overhead noted at $60,060

Cost of goods sold was $117,000

Explanation:

Materials inventory on December 1 equals $9,900

Direct materials acquired total 28,000

Materials inventory by December 31 amounts to $15,000

Direct materials utilized is 22,900

Direct Labor summed to $40,040

Factory Overhead totaled $60,060

Conversion Costs total $100,100

Overall Manufacturing Costs amounted to $123,000

Work in process inventory has risen by $12,000

Cost of goods manufactured is reported at $135,000

Finished goods inventory has decreased by $18,000 over the year

Cost of goods sold is $117,000

Calculating

Conversion costs are calculated as = Direct Labor + Factory Overhead

100,100 = 100 % + 150%

100,100= 100x + 150x

100,100= 250 x

x= 100,100/250

x= 400.4

Direct Labor = 100% * 400.4= $ 40,040

Factory Overhead = 150% * 400.4= $ 60,060