QUESTIONS 45 THROUGH 68 RELATE TO FINANCIAL STATEMENT ANALYSIS

59. A review of a company’s inventory records for the year indicates that the following costs were

incurred:

Fixed production overhead: $500,000

Direct material and direct labor: 300,000

Storage costs incurred during production: 25,000

Abnormal waste costs: 30,000

If the company operated at full capacity during the year, the total capitalized inventory cost is

closest to:

A. $800,000.

B. $825,000.

C. $855,000.