A business operated at 100% of capacity during its first month, with the following results: Sales (112 units) $448,000 P…
The following solution is suggested to handle the subject “A business operated at 100% of capacity during its first month, with the following results: Sales (112 units) $448,000 P…“. Let’s keep an eye on the content below!
Question “A business operated at 100% of capacity during its first month, with the following results: Sales (112 units) $448,000 P…”
A business operated at 100% of capacity during its first month,
with the following results:
What is the amount of the income from operations that would be
reported on the absorption costing income statement?
a.$355,061 b.$359,324 c.$447,860 d.$334,453
Answer
Income statement
Sales
448,000
Selling price of goods:
Material directly
60,536
Direct labor
15,456
Overhead variable for factories
27,048
Fixed overhead in the factory
25,760
128,800
Ending inventory (128,800×28/140).
-25,760
Selling price
-103,040
Gross profit
344,960
Operating expenses
Variable operating costs
-6,244
Fixed operating costs
-4,263
Net operating income
$334,453
Net operating income = $334,453
The correct option is (d).
If you are happy with the solution, please give it a positive rating. If you have any questions, please ask.
Conclusion
Above is the solution for “A business operated at 100% of capacity during its first month, with the following results: Sales (112 units) $448,000 P…“. We hope that you find a good answer and gain the knowledge about this topic of business.
