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Question - Espresso Manufacturing produces snow shovels. The selling price per snow shovel is $28.00. There is no beginning inventory.
Costs involved in production are:
Direct material $6.00
Direct labor 4.00
Variable manufacturing overhead 4.00
Total variable manufacturing costs per unit $14.00
Fixed manufacturing overhead per year $196,560
In addition, the company has fixed selling and administrative costs of $170,900 per year.
During the year, Espresso produces 50,400 snow shovels and sells 45,390 snow shovels.
What is the value of ending inventory using full costing?
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