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A business operated at 100% of capacity during its first month, with the following results: Sales (99 units)   $485,100 Production costs (124 units):      Direct materials $65,682      Direct labor 16,770      Variable factory overhead 29,347      Fixed factory overhead 27,949 139,748   Operating expenses:      Variable operating expenses $6,083      Fixed operating expenses 4,871 10,954 The amount of gross profit that would be reported on the absorption costing income statement is a.$373,527 b.$484,976 c.$367,444 d.$362,573

A business operated at 100% of capacity during its first month, with the following results: Sales (99 units)   $485,100 Production costs (124 units):      Direct materials $65,682      Direct labor 16,770      Variable factory overhead 29,347      Fixed factory overhead 27,949 139,748   Operating expenses:      Variable operating expenses $6,083      Fixed operating expenses 4,871 10,954 The amount of gross profit that would be reported on the absorption costing income statement is a.$373,527 b.$484,976 c.$367,444 d.$362,573

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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A business operated at 100% of capacity during its first month, with the following results:

Sales (99 units)   $485,100
Production costs (124 units):  
   Direct materials $65,682  
   Direct labor 16,770  
   Variable factory overhead 29,347  
   Fixed factory overhead 27,949 139,748
 
Operating expenses:  
   Variable operating expenses $6,083  
   Fixed operating expenses 4,871 10,954

The amount of gross profit that would be reported on the absorption costing income statement is

a.$373,527
b.$484,976
c.$367,444
d.$362,573
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