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A business operated at 100% of capacity during its first month and incurred the following costs: Production costs (20,000 units): Direct materials $180,000 Direct labor

A business operated at 100% of capacity during its first month and incurred the following costs:

Production costs (20,000 units):
Direct materials

$180,000

Direct labor

240,000

Variable factory overhead

280,000

Fixed factory overhead

100,000

$800,000

Operating expenses:
Variable operating expenses

$130,000

Fixed operating expenses

50,000

180,000

If 1,600 units remain unsold at the end of the month, what is the amount of inventory that would be reported on the variable costing balance sheet?

A. $64,000
B. $56,000
C. $78,400
D. $66,400

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