The contribution margin ratio of Baginski Corporation\'s only product is 53%. Th

Question

The contribution margin ratio of Baginski Corporation's only product is 53%. The company's monthly fixed expense is $617,980 and the company's monthly target profit is $23,000. What are the dollar sales to attain that target profit closest to? $1,166,000 $339,719 $1,209,396 $327,529 Last year, Rassel Corporation's variable costing net operating income was $63,200. Fixed manufacturing overhead costs deferred in inventory under absorption costing amounted to $31,900. What was the absorption costing net operating income last year? $32,900 $95,100 $31,300 $63,200.

Explanation / Answer

Solution-5

c. $1,209,396

Calculation-

Target Profit = (Fixed Expenses + Target Profit)/Contribution margin ratio

Target Profit = ($617,980 + $23,000) / 53%

Target Profit = $1,209,396

Solution-6

C. $31,300

Calculation-

Variable Costing net operating income $63,200 Add-Fixed Manufacturing overhead costs deferred in inventory under absorption costing 0 Less-Fixed Manufacturing overhead costs released from inventory under absorption costing $31,900 Absorption costing net operating income $31,300

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