Data for the last fiscal year for Merlene Company are as follows: *Denominator level of activity is
Question:
Data for the last fiscal year for Merlene Company are as follows:
*Denominator level of activity is 750 units for the year
Actual selling and administrative costs equaled the budgeted amount, and there were no work in process inventories at the end of the period. Under the variable costing concept, the amount of operating income earned by Merlene for the year was:
a. $21,500.
b. $22,500.
c. $28,000.
d. $31,000.
Transcribed Image Text:
Units Beginning inventory of finished goods Production during the year 100 700 Sales 750 Ending inventory of finished goods 50 Per Unit $ 200 Product selling price Variable manufacturing cost Fixed manufacturing cost 90 20* Budgeted selling and administrative costs (all fixed) $45,000
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Forensic And Investigative Accounting
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Authors: G. Stevenson Smith D. Larry Crumbley, Edmund D. Fenton
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