5. A business operated at 100% capacity during its first month of operations, with the following results: Sales (90 units) $90,000Production costs (100 units) Direct materials$40,000 Direct labor 20,000 Variable factory overhead 2,000 Fixed factory overhead 7,000 Total manufacturing costs 69,000Operating expenses: Variable Variable operating expenses$ 8,000 Fixed operating expenses 1,000 Total operating expenses 9,000 Use this information to complete a variable costing income statement.

Variable costing income statement refers to all the variable costs which are subtracted from income…

Answered: Sales (90 units) $90,000…

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter7: Variable Costing For Management analysis

Section: Chapter Questions

Problem 5E: On April 30, the end of the first month of operations, Joplin Company prepared the following income...

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

Sales (90 units)		$90,000
Production costs (100 units)
Direct materials	$40,000
Direct labor	20,000
Variable factory overhead	2,000
Fixed factory overhead	7,000
Total manufacturing costs		69,000
Operating expenses:
Variable
Variable operating expenses	$ 8,000
Fixed operating expenses	1,000
Total operating expenses		9,000

Use this information to complete a variable costing income statement.

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