A business operated at 100% of capacity during its first month, with the following results:Sales (112 units) $560,000Production costs (140 units): Direct materials$70,000 Direct labor17,500 Variable factory overhead31,500 Fixed factory overhead28,000147,000 Operating expenses: Variable operating expenses$6,170 Fixed operating expenses3,7709,940What is the amount of the income from operations that would be reported on the variable costing income statement?

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Answered: A business operated at 100% of capacity…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter2: Basic Cost Management Concepts

Section: Chapter Questions

Problem 24E: Last year, Orsen Company produced 25,000 juicers and sold 26,500 juicers for 60 each. The actual...

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A business operated at 100% of capacity during its first month, with the following results:

Sales (112 units)		$560,000
Production costs (140 units):
Direct materials	$70,000
Direct labor	17,500
Variable factory overhead	31,500
Fixed factory overhead	28,000	147,000

Operating expenses:
Variable operating expenses	$6,170
Fixed operating expenses	3,770	9,940

What is the amount of the income from operations that would be reported on the variable costing income statement?

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