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Requirement 2. What is the cost per unit for lifts completed and transferred out to Finished Goods Inventory? Why would management be interested in this cost? The cost per unit for lifts completed and transferred out to Finished Goods Inventory is per lift. Why would management be interested in the cost per unit for lifts completed and transferred out to Finished Goods Inventory? A. Managers would compare the average cost per lift against their budgeted costs to determine whether the costs of the Testing Department remain under control. If budgeted costs are higher than the actual average cost per lift, then the managers have done a good job controlling costs. In contrast, if the budgeted costs are lower than the actual average cost per lift, managers will investigate the reason for the higher-than-expected costs in an effort to regain control over costs. B. Managers use the cost per lift for external financial reporting specifically to calculate the Cost of Goods Sold on the Income Statement. C. Managers use the cost per lift for external financial reporting specifically to calculate the ending inventory balances on the Balance Sheet. D. All of the above are reasons why management would be interested in this cost per unit for lifts completed and transferred out to Finished Goods Inventory.

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