A manufacturing company that produces a single product has p

A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations:

Selling price -------------------------------------- $140

Units in beginning inventory ----------------- 0

Units produced ---------------------------------- 1,200

Units sold -----------------------------------------    800

Units in ending inventory ---------------------    400

Variable costs per unit:

   Direct materials ------------------------------- $25

   Direct labor ------------------------------------  $41

   Variable manufacturing overhead -------   $6

   Variable selling and administrative ------   $6

Fixed costs:

   Fixed manufacturing overhead ----------- $24,000

   Fixed selling and administrative ----------   12,000

What is the net operating income for the month under variable costing?

$21,600

($15,200)

$8,000

$13,600

	a.	$21,600
	b.	($15,200)
	c.	$8,000
	d.	$13,600

Solution

d. $13,600 Dear Student Thank you for using Chegg Please find below the answer    Statementshowing Computations Paticulars Amount Sales = 800 * 140            112,000.00 Less Variable Expenses Direct materials = 800*25              20,000.00 Direct labor = 800 * 41              32,800.00 Variable manufacturing overhead = 800*6                4,800.00 Variable selling and administrative = 800 *6                4,800.00 Total Variable costs              62,400.00 Contribution Margin              49,600.00 Fixed cost Fixed manufacturing overhead              24,000.00 Fixed selling and administrative              12,000.00 Fixed costs              36,000.00 Net operating income              13,600.00