Question 12 The Colin Division of Mochrie Company sells its product for $36 per unit. Variable costs per unit are: manufacturing, $14; and selling and administrative, $3. Fixed costs are: $280000 manufacturing overhead, and $50000 selling and administrative. There was no beginning inventory. Expected sales for next year are 40000 units. Ryan Stiles, the manager of the Colin Division, is under pressure to improve the performance of the Division. As he plans for next year, he has to decide whether to produce 40000 units or 50000 units. What would the net income be under variable costing for each alternative? 40000 units 50000 units $430000 $430000 $430000 $486000 LINK TO TEXT $430000 $486000 $496000 $430000
Question 12 The Colin Division of Mochrie Company sells its product for $36 per unit. Variable costs per unit are: manufacturing, $14; and selling and administrative, $3. Fixed costs are: $280000 manufacturing overhead, and $50000 selling and administrative. There was no beginning inventory. Expected sales for next year are 40000 units. Ryan Stiles, the manager of the Colin Division, is under pressure to improve the performance of the Division. As he plans for next year, he has to decide whether to produce 40000 units or 50000 units. What would the net income be under variable costing for each alternative? 40000 units 50000 units $430000 $430000 $430000 $486000 LINK TO TEXT $430000 $486000 $496000 $430000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Question 12
The Colin Division of Mochrie Company sells its product for $36 per unit. Variable costs per unit are: manufacturing,
$14; and selling and administrative, $3. Fixed costs are: $280000 manufacturing overhead, and $50000 selling and
administrative. There was no beginning inventory. Expected sales for next year are 40000 units. Ryan Stiles, the
manager of the Colin Division, is under pressure to improve the performance of the Division. As he plans for next
year, he has to decide whether to produce 40000 units or 50000 units. What would the net income be under variable
costing for each alternative?
40000 units
$430000
$430000
$430000
$486000
LINK TO TEXT
50000 units
$430000
$486000
$496000
$430000
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