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Question - Sprinkle Co. sells its product for $60 per unit. During 2016, it produced 60,000 units and sold 50,000 units (there was no beginning inventory). Costs per unit are: direct materials $15, direct labor $9, and variable overhead $3. Fixed costs are: $720,000 manufacturing overhead, and $90,000 selling and administrative expenses. Reference: Ref 6-5 Under absorption costing, what amount of fixed overhead is deferred to a future period?
a. $30,000
b. $120,000
c. $150,000
d. $720,000
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