Harris Company Produces a Single Product

Multiple Choice

Harris Company produces a single product. Last year, Harris manufactured 17,000 units and sold 13,000 units. Production costs for the year were as follows: Sales were $780,000 for the year, variable selling and administrative expenses were $88,400, and fixed selling and administrative expenses were $170,000. There was no beginning inventory. Assume that direct labor is a variable cost.
-Under absorption costing, the carrying value on the balance sheet of the ending inventory for the year would be:

A) $190,800
B) $170,000
C) $230,800
D) $0