Answer (B) is correct . The only costs capitalized are the variable costs of manufacturing. Prime costs (direct materials and direct labor) are variable. Prime costs (direct materials and direct labor) $800,000 Variable manufacturing overhead 100,000 Total inventoriable costs $900,000
Answer (A) is incorrect because The amount of $800,000 equals only the prime costs.
Answer (C) is incorrect because The amount of $980,000 includes the variable selling and other expenses.
Answer (D) is incorrect because The amount of $1,060,000 equals inventoriable costs under absorption costing.
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If Jubal uses variable costing, the inventoriable costs for the fiscal year are
