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A business operated at 100% of capacity during its first month, with the following results: Sales (108 units) Production costs (135 units): $626,400 Direct materials $84,642 Direct labor 21,611 Variable factory overhead 37,819 Fixed factory overhead 36,018 180,090 Operating expenses: Variable operating expenses $5,253 Fixed operating expenses 4,584 9,837 The amount of gross profit that would be reported on the absorption costing income statement is: a. $472, 491. b. $482, 328. c. $477,075. d. $626, 265.

A business operated at 100% of capacity during its first month, with the following results: Sales (108 units) Production costs (135 units): $626,400 Direct materials $84,642 Direct labor 21,611 Variable factory overhead 37,819 Fixed factory overhead 36,018 180,090 Operating expenses: Variable operating expenses $5,253 Fixed operating expenses 4,584 9,837 The amount of gross profit that would be reported on the absorption costing income statement is: a. $472, 491. b. $482, 328. c. $477,075. d. $626, 265.

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 (108 units) Production costs (135 units): $626,400 Direct materials $84,642 Direct labor 21,611 Variable factory overhead 37,819 Fixed factory overhead 36,018 180,090 Operating expenses: Variable operating expenses $5,253 Fixed operating expenses 4,584 9,837 The amount of gross profit that would be reported on the absorption costing income statement is: a. $472, 491. b. $482, 328. c. $477,075. d. $626, 265.
Transcribed Image Text:A business operated at 100% of capacity during its first month, with the following results: Sales (108 units) Production costs (135 units): $626,400 Direct materials $84,642 Direct labor 21,611 Variable factory overhead 37,819 Fixed factory overhead 36,018 180,090 Operating expenses: Variable operating expenses $5,253 Fixed operating expenses 4,584 9,837 The amount of gross profit that would be reported on the absorption costing income statement is: a. $472, 491. b. $482, 328. c. $477,075. d. $626, 265.
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