A business operated at 100% of capacity during its first month, with the following results: Sales (128 units) $705,400 Production costs (156 units): Direct materials $85,642 Direct labor $24,611 Variable factory overhead $37,010 Fixed factory overhead $35,018 182,281 Operating expenses: Variable operating expenses $5,253 Fixed operating expenses 4,784 10,037 The amount of gross profit that would be reported on the absorption costing income statement is

Cornerstones of Cost Management (Cornerstones Series)
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Chapter2: Basic Cost Management Concepts
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Problem 22E: Ellerson Company provided the following information for the last calendar year: During the year,...
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Sales 128 units

A business operated at 100% of capacity during its first month, with the following
results:
Sales (128 units)
$705,400
Production costs (156 units):
Direct materials
$85,642
Direct labor
$24,611
Variable factory overhead
$37,010
Fixed factory overhead
$35,018 182,281
Operating expenses:
Variable operating expenses $5,253
Fixed operating expenses
4,784
10,037
The amount of gross profit that would be reported on the absorption costing
income statement is
Transcribed Image Text:A business operated at 100% of capacity during its first month, with the following results: Sales (128 units) $705,400 Production costs (156 units): Direct materials $85,642 Direct labor $24,611 Variable factory overhead $37,010 Fixed factory overhead $35,018 182,281 Operating expenses: Variable operating expenses $5,253 Fixed operating expenses 4,784 10,037 The amount of gross profit that would be reported on the absorption costing income statement is
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