Use the following information for items
Obama Company sells its product for $25 per unit.During 2020, it produced 20,000 units and sold 15,000 units (there was no beginning inventory).Costs per unit are: direct materials $5, direct labour $4, and variable overhead $3.Fixed costs are: $300,000 manufacturing overhead, and $50,000 selling and administrative expenses.
-Cost of goods sold under absorption costing is
A)$180,000.
B)$405,000.
C)$442,500.
D)$540,000.

Question

Use the following information for items 
Obama Company sells its product for $25 per unit.During 2020, it produced 20,000 units and sold 15,000 units (there was no beginning inventory).Costs per unit are: direct materials $5, direct labour $4, and variable overhead $3.Fixed costs are: $300,000 manufacturing overhead, and $50,000 selling and administrative expenses.
-Cost of goods sold under absorption costing is
A)$180,000.
B)$405,000.
C)$442,500.
D)$540,000.

Quizplus · Accepted Answer

The Answer is B

Use the Following Information for Items