A business operated at 100% of capacity during its first month, with the following results: Sales (112 units) $560,000 Production costs (140 units): Direct materials $70,000 Direct labor 17,500 Variable factory overhead 31,500 Fixed factory overhead 28,000 147,000 Operating expenses: Variable operating expenses $6,470 Fixed operating expenses 3,880 10,350 What is the amount of the contribution margin that would be reported on the variable costing income statement? a.$559,860 b.$549,650 c.$454,450 d.$458,330
A business operated at 100% of capacity during its first month, with the following results: Sales (112 units) $560,000 Production costs (140 units): Direct materials $70,000 Direct labor 17,500 Variable factory overhead 31,500 Fixed factory overhead 28,000 147,000 Operating expenses: Variable operating expenses $6,470 Fixed operating expenses 3,880 10,350 What is the amount of the contribution margin that would be reported on the variable costing income statement? a.$559,860 b.$549,650 c.$454,450 d.$458,330
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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100%
A business operated at 100% of capacity during its first month, with the following results:
Sales (112 units) | $560,000 | |
Production costs (140 units): | ||
Direct materials | $70,000 | |
Direct labor | 17,500 | |
Variable factory |
31,500 | |
Fixed factory overhead | 28,000 | 147,000 |
Operating expenses: | ||
Variable operating expenses | $6,470 | |
Fixed operating expenses | 3,880 | 10,350 |
What is the amount of the contribution margin that would be reported on the variable costing income statement?
a.$559,860
b.$549,650
c.$454,450
d.$458,330
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