A business operated at 100% of capacity during its first month and incurred the following costs: Production costs (17,800 units): Direct materials $171,000 Direct labor 238,600 Variable factory overhead 256,400 Fixed factory overhead 90,600 $756,600 Operating expenses: Variable operating expenses $131,600 Fixed operating expenses 48,200 179,800 If 1,600 units remain unsold at the end of the month and sales total $1,190,000 for the month, what would be the amount of income from operations reported on the absorption costing income statement? a.$313,465 b.$59,865 c.$68,009 d.$321,609
A business operated at 100% of capacity during its first month and incurred the following costs: Production costs (17,800 units): Direct materials $171,000 Direct labor 238,600 Variable factory overhead 256,400 Fixed factory overhead 90,600 $756,600 Operating expenses: Variable operating expenses $131,600 Fixed operating expenses 48,200 179,800 If 1,600 units remain unsold at the end of the month and sales total $1,190,000 for the month, what would be the amount of income from operations reported on the absorption costing income statement? a.$313,465 b.$59,865 c.$68,009 d.$321,609
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter18: Pricing And Profitability Analysis
Section: Chapter Questions
Problem 3CE: Pattison Products, Inc., began operations in October and manufactured 40,000 units during the month...
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Question
A business operated at 100% of capacity during its first month and incurred the following costs:
Production costs (17,800 units): | ||
Direct materials | $171,000 | |
Direct labor | 238,600 | |
Variable factory |
256,400 | |
Fixed factory overhead | 90,600 | $756,600 |
Operating expenses: | ||
Variable operating expenses | $131,600 | |
Fixed operating expenses | 48,200 | 179,800 |
If 1,600 units remain unsold at the end of the month and sales total $1,190,000 for the month, what would be the amount of income from operations reported on the absorption costing income statement?
a.$313,465
b.$59,865
c.$68,009
d.$321,609
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