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Managerial Accounting

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Moderate

Variable Costing Compute Ending Inventory

MGRACT-APURU@

Black Forest Time Pieces produces and sells a mantel clock for $200 each. Last year, 42,000 clocks were produced and 37,000 were sold. Other information for the prior year include:

Clock costs, per unit:
Direct materials \$40.00
Direct labor \$5.00
Variable manufacturing \$7.50
Sales commissions \$12.50
Fixed manufacturing (based on 10,000 units per month) \$62.50
Administrative (all fixed) \$37.50

There were no beginning inventories last year.

What is the cost of the ending inventory for last year under the variable costing method?