Crossbow Corp.produces a single product.Data concerning June's operations follow: Under absorption costing,ending inventory on the balance sheet would be valued at:
A)$10,000
B)$7,000
C)$9,000
D)$12,000

Question

Crossbow Corp.produces a single product.Data concerning June's operations follow:  Under absorption costing,ending inventory on the balance sheet would be valued at:
A)$10,000 
B)$7,000 
C)$9,000 
D)$12,000

Quizplus · Accepted Answer

Units in ending inventory = Units in beginning inventory + Units produced - Units sold
= 0 units + 6,000 units - 5,000 units = 1,000 units
Unit product cost under absorption costing:
 11eaa3fe_32bf_ea00_908b_cd85ecedaac1_TB2461_00 Ending finished goods inventory = $9 per unit × 1,000 units = $9,000