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Chapter 8, Problem 8.9SE

1.

To determine

To compute: How much bins of each size should the company SA will produce.

2.

To determine

To compute: Operating income of the company

3.

To determine

To explain: Why the operating income is less as compared to when the company is producing its optimal mix.

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Sunset Company reported net income of $120,000 using absorption costing. The company produced 30,000 units and sold 25,000 units during the year. Beginning inventory was zero. Fixed manufacturing overhead was $150,000, and the variable manufacturing cost was $15 per unit. There was no underapplied or overapplied overhead. Calculate Sunset Company's net income under variable costing. A. $95,000 B. $120,000 C. $145,000 D. $170,000

Chapter 8 Solutions

Managerial Accounting, Student Value Edition Plus New Myaccountinglab With Pearson Etext -- Access Card Package (4th Edition) By Braun, Karen W., Tietz, Wendy M. (2014) Loose Leaf

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