Yellowstone Company began operations on January 1 to produce a hiking poles. It used an absorption costing system with a planned production volume of 104,000 units. During its first year of operations, the planned production volume was achieved, and there were no fixed selling or administrative expenses. Inventory on December 31 was 10,400 units, and operating income for the year was $374,400. Required: 1. If Yellowstone Company had used variable costing, its operating income would have been $332,800. Compute the break-even point in units under variable costing.
Yellowstone Company began operations on January 1 to produce a hiking poles. It used an absorption costing system with a planned production volume of 104,000 units. During its first year of operations, the planned production volume was achieved, and there were no fixed selling or administrative expenses. Inventory on December 31 was 10,400 units, and operating income for the year was $374,400. Required: 1. If Yellowstone Company had used variable costing, its operating income would have been $332,800. Compute the break-even point in units under variable costing.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Yellowstone Company began operations on January 1 to produce a hiking poles. It used an absorption costing system with a planned production volume of 104,000 units. During its first year of operations, the planned production volume was achieved, and there were no fixed selling or administrative expenses. Inventory on December 31 was 10,400 units, and operating income for the year was $374,400.
Required:
1. If Yellowstone Company had used variable costing, its operating income would have been $332,800. Compute the break-even point in units under variable costing.
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