Erie Corporation manufactures a single product that it sells for $35 per unit. The company has the following cost structure: Variable costs per unit: Production $ 8 Selling and administrative $ 5 Fixed costs per year: Production $ 82,500 Selling and administrative $ 60,000 There were no units in inventory at the beginning of the year. During the year 30,000 units were produced and 25,000 units were sold. The company's net operating income under variable costing would be: $407,500 $421,250 $431,250 $417,500
Erie Corporation manufactures a single product that it sells for $35 per unit. The company has the following cost structure: Variable costs per unit: Production $ 8 Selling and administrative $ 5 Fixed costs per year: Production $ 82,500 Selling and administrative $ 60,000 There were no units in inventory at the beginning of the year. During the year 30,000 units were produced and 25,000 units were sold. The company's net operating income under variable costing would be: $407,500 $421,250 $431,250 $417,500
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter3: Cost Behavior
Section: Chapter Questions
Problem 26E: Starling Co. manufactures one product with a selling price of 18 and variable cost of 12. Starlings...
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