Tech Wave Inc. operated at 100% capacity during its first month, with the following results: Sales (120 units): $120,000 Production Costs (150 units): -Direct Materials: $60,000 -Direct Labor: $30,000 -Variable Factory Overhead: $4,500 -Fixed Factory Overhead: $10,500 Operating Expenses: -Variable Operating Expenses: $12,000 -Fixed Operating Expenses: $2,000 What is the amount of the gross profit that would be reported on the absorption costing income statement? a. $36,000 b. $42,000 c. $40,500 d. $45,000
Tech Wave Inc. operated at 100% capacity during its first month, with the following results: Sales (120 units): $120,000 Production Costs (150 units): -Direct Materials: $60,000 -Direct Labor: $30,000 -Variable Factory Overhead: $4,500 -Fixed Factory Overhead: $10,500 Operating Expenses: -Variable Operating Expenses: $12,000 -Fixed Operating Expenses: $2,000 What is the amount of the gross profit that would be reported on the absorption costing income statement? a. $36,000 b. $42,000 c. $40,500 d. $45,000
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter6: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 2CMA
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