Krepps Corporation produces a single product. Last year, Krepps manufactured 34,250 units and sold 28,800 units. Production costs for the year were as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Sales totaled $1,434,200 for the year, variable selling and administrative expenses totaled $167,560, and fixed selling and administrative expenses totaled $215,775. There was no beginning inventory. Assume that direct labor is a variable cost. Under variable costing, the company's net operating income for the year would be: Multiple Choice O $103,550 lower than under absorption costing. O$111150 lower than under absorption costing. O $103,550 higher than under absorption costing. $ 284,275 $140,425 $ 256,875 $ 650,750 $111,150 higher than under absorption costing.

Krepps Corporation produces a single product. Last year, Krepps manufactured 34,250 units and sold 28,800 units. Production costs for the year were as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Sales totaled $1,434,200 for the year, variable selling and administrative expenses totaled $167,560, and fixed selling and administrative expenses totaled $215,775. There was no beginning inventory. Assume that direct labor is a variable cost. Under variable costing, the company's net operating income for the year would be: Multiple Choice O $103,550 lower than under absorption costing. O$111150 lower than under absorption costing. O $103,550 higher than under absorption costing. $ 284,275 $140,425 $ 256,875 $ 650,750 $111,150 higher than under absorption costing.

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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Cc. 188.
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