Sierra Company incurs the following costs to produce and sell its only product. During this year, 25,000 units were produced and 22,000 units were sold. The Finished Goods inventory account at the end of this year shows a balance of $72 , 000 for the 3,000 unsold units. Required: 1-a. Calculate this year's ending balance in Finished Goods inventory two ways-using variable costing and using absorption costing. 1-b. Does it appear that the company is using variable costing or absorption costing to assign costs to the 3,000 units in its Finished Goods inventory? 2. Assume that the company wishes to prepare this year's financial statements for its stockholders. a. Is Finished Goods inventory of $72 , 000 the correct amount to include on the balance sheet for external reporting purposes? b. What balance should be reported in the Finished Goods inventory account for external reporting purposes? Complete this question by entering your answers in the tabs below. Calculate this year's ending balance in Finished Goods inventory two ways-using variable costing and using absorption costing. bes it appear that the company is using variable costing or absorption costing to assign costs to the 3,000 units in its nished Goods inventory? Assume that the company wishes to prepare this year's financial statements for its stockholders. Is Finished Goods inventory of $72 , 000 the correct amount to include on the balance sheet for external reporting purposes? Assume that the company wishes to prepare this year's financial statements for its stockholders. What balance should be reported in the Finished Goods inventory account for external reporting purposes? Finished goods inventory balance for external reporting purposes.

1. Sierra Company incurs the following costs to produce and sell its only product. During this year,
25,000 units were produced and 22,000 units were sold. The Finished Goods inventory account
at the end of this year shows a balance of $72 , 000 for the 3,000 unsold units. Required: 1-a.
Calculate this year's ending balance in Finished Goods inventory two ways-using variable
costing and using absorption costing. 1-b. Does it appear that the company is using variable
costing or absorption costing to assign costs to the 3,000 units in its Finished Goods inventory?
2. Assume that the company wishes to prepare this year's financial statements for its
stockholders. a. Is Finished Goods inventory of $72 , 000 the correct amount to include on the
balance sheet for external reporting purposes? b. What balance should be reported in the
Finished Goods inventory account for external reporting purposes? Complete this question by
entering your answers in the tabs below. Calculate this year's ending balance in Finished Goods
inventory two ways-using variable costing and using absorption costing. bes it appear that the
company is using variable costing or absorption costing to assign costs to the 3,000 units in its
nished Goods inventory? Assume that the company wishes to prepare this year's financial
statements for its stockholders. Is Finished Goods inventory of $72 , 000 the correct amount to
include on the balance sheet for external reporting purposes? Assume that the company wishes to
prepare this year's financial statements for its stockholders. What balance should be reported in
the Finished Goods inventory account for external reporting purposes? Finished goods inventory
balance for external reporting purposes