The Southern Corporation manufactures a single product and has the following cost structure: Last year, 7,000 units were produced and 6,800 units were sold. There was no beginning inventory.The carrying value on the balance sheet of the ending inventory of finished goods under variable costing would be:
A) the same as absorption costing.
B) $6,800 greater than under absorption costing.
C) $6,800 less than under absorption costing.
D) $4,000 less than under absorption costing.

Question

The Southern Corporation manufactures a single product and has the following cost structure:  Last year, 7,000 units were produced and 6,800 units were sold. There was no beginning inventory.The carrying value on the balance sheet of the ending inventory of finished goods under variable costing would be:
A) the same as absorption costing. 
B) $6,800 greater than under absorption costing. 
C) $6,800 less than under absorption costing. 
D) $4,000 less than under absorption costing.

Quizplus · Accepted Answer

The Answer of The Southern Corporation manufactures a single product and has the following cost structure:  Last year, 7,000 units were produced and 6,800 units were sold. There was no beginning inventory.The carrying value on the balance sheet of the ending inventory of finished goods under variable costing would be:
A) the same as absorption costing. 
B) $6,800 greater than under absorption costing. 
C) $6,800 less than under absorption costing. 
D) $4,000 less than under absorption costing.

The Southern Corporation Manufactures a Single Product and Has the Following