A business operated at 100% of capacity during its first month and incurred the
ID: 2370681 • Letter: A
Question
A business operated at 100% of capacity during its first month and incurred the following costs:
Production costs (10,000 units):
Direct Materials $140,000
Direct Labor 40,000
Variable Factory Overhead 20,000
Fixed factory overhead 4,000 $204,000
Operating expneses:
variable operating expenses $34,000
fixed operating expenses 2,000 36,000
If 2,000 units remain unsold at the end of the month and sales total $300,000 for the month, what would be the amount of income from operations reported on the variable costing income statment?
a) 100,800
b 100,000
c) 114,800
d) 140,000
(please show work)
Explanation / Answer
sales=300000 less:direct material=140000 less:direct labor=40000 less:variable factory overhead=20000 add:closing stock=(2000*20)=40000 income from operations =140000 ans is d
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.