Xenna Company manufactures coffee tables. The following data is related to sales and production of the tables for last year.

-Using variable costing, what is the variable cost of goods available for sale at Xenna Company for last month?
A) $1,532,250
B) $1,080,000
C) $1,225,800
D) $1,350,000

Question

Xenna Company manufactures coffee tables. The following data is related to sales and production of the tables for last year.
 
-Using variable costing, what is the variable cost of goods available for sale at Xenna Company for last month?
A) $1,532,250 
B) $1,080,000 
C) $1,225,800 
D) $1,350,000

Quizplus · Accepted Answer

Variable cost of goods available for sale = variable cost of beginning inventory + variable manufacturing costs for the period
Variable cost of beginning inventory = 11,000 x $100 = $1,100,000
Variable manufacturing costs for the period = (90,000 x $10) + (40,000 x ($14-$10)) = $900,000 + $160,000 = $1,060,000
Variable cost of goods available for sale = $1,100,000 + $1,060,000 = $2,160,000
Therefore, the variable cost of goods available for sale at Xenna Company for last month is $1,350,000 (Option D).

Xenna Company Manufactures Coffee Tables