Stephenson Company's computer system recently crashed,erasing much of the Company's financial data.The following accounting information was discovered soon afterwards on the CFO's backup computer disk.
Direct labor cost incurred during the period amounted to 1.5 times the factory overhead.The CFO of Stephenson Company has asked you to recalculate the following accounts and report to him by week's end.
What should be the amount in the finished goods inventory at December 31,2010?
A)$42,000.
B)$47,000.
C)$40,000.
D)$51,000. $47,000 = $126,000 + $41,000 - $120,000

Question

Stephenson Company's computer system recently crashed,erasing much of the Company's financial data.The following accounting information was discovered soon afterwards on the CFO's backup computer disk. 
Direct labor cost incurred during the period amounted to 1.5 times the factory overhead.The CFO of Stephenson Company has asked you to recalculate the following accounts and report to him by week's end.
What should be the amount in the finished goods inventory at December 31,2010?
A)$42,000. 
B)$47,000. 
C)$40,000. 
D)$51,000. $47,000 = $126,000 + $41,000 - $120,000

Quizplus · Accepted Answer

Based on the given information and the calculation of finished goods inventory formula (Beginning Finished Goods + Cost of Goods Manufactured - Ending Finished Goods), the correct amount in finished goods inventory at December 31, 2010 should be $47,000. Therefore, option B is the correct answer.

Stephenson Company's Computer System Recently Crashed,erasing Much of the Company's