Swisher, Incorporated reports the following annual cost data for its single product: Normal production level Direct materials Direct labor Variable overhead Fixed overhead $ $ 6.40 per unit 3.93 per unit 5.80 per unit $150,000 in total 30,000 units $ This product is normally sold for $48 per unit. If Swisher increases its production to 50,000 units, while sales remain at the current 30,000 unit level, by how much would the company's income increase or decrease under variable costing?
Swisher, Incorporated reports the following annual cost data for its single product: Normal production level Direct materials Direct labor Variable overhead Fixed overhead $ $ 6.40 per unit 3.93 per unit 5.80 per unit $150,000 in total 30,000 units $ This product is normally sold for $48 per unit. If Swisher increases its production to 50,000 units, while sales remain at the current 30,000 unit level, by how much would the company's income increase or decrease under variable costing?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
![Swisher, Incorporated reports the following annual cost data for its single product:
Normal production level
Direct materials
Direct labor
Variable overhead
Fixed overhead
Multiple Choice
$60,000 decrease
This product is normally sold for $48 per unit. If Swisher increases its production to 50,000 units, while sales remain at the
current 30,000 unit level, by how much would the company's income increase or decrease under variable costing?
$90,000 decrease
$90,000 Increase.
30,000 units
6.40 per unit
3.93 per unit
5.80 per unit
$150,000 in total
$
$60,000 increase.
There is no change in income.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F4547b1e0-f202-4b7c-a4bc-1b21f24da442%2Fad0692d0-c848-49c7-8302-a6bcac46ebd3%2F4j8rtjm_processed.png&w=3840&q=75)
Transcribed Image Text:Swisher, Incorporated reports the following annual cost data for its single product:
Normal production level
Direct materials
Direct labor
Variable overhead
Fixed overhead
Multiple Choice
$60,000 decrease
This product is normally sold for $48 per unit. If Swisher increases its production to 50,000 units, while sales remain at the
current 30,000 unit level, by how much would the company's income increase or decrease under variable costing?
$90,000 decrease
$90,000 Increase.
30,000 units
6.40 per unit
3.93 per unit
5.80 per unit
$150,000 in total
$
$60,000 increase.
There is no change in income.
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