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
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 |
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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