A business operated at 100% of capacity during its first month and incurred the following costs:Production costs (5,000 units):Direct materialsDirect laborVariable factory overheadFixed factory overheadOperating expenses:Variable operating expenses$17,000Fixed operating expenses1,00018,000If 1,000 units remain unsold at the end of the month and sales total $150,000 for the month, the amount of contribution margin that would be reportedon the variable costing income statement isOa. $51,400Ob. $52,000Oc. $54,000Od. $53,000$70,00020,00010,0002,000$102,000

The difference between Total Sales and Total Variable Cost is known as Contribution. All the direct…

If 1,000 units remain unsold at the end of the month and sales total $150,000 for the month, the amount of contribution margin that would be reported on the variable costing income statement is Oa. $51,400 Ob. $52,000 Oc. $54,000 Od. $53,000

If 1,000 units remain unsold at the end of the month and sales total $150,000 for the month, the amount of contribution margin that would be reported on the variable costing income statement is Oa. $51,400 Ob. $52,000 Oc. $54,000 Od. $53,000

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter7: Variable Costing For Management analysis

Section: Chapter Questions

Problem 8E: Estimated income statements, using absorption and variable costing Prior to the first month of...

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