Use the following information to answer questions Turn, Inc. budgeted 10,000 widgets for production during 2016. Turn has capacity to produce 15,000 units. The sale price of the widgets is $80 per unit. Fixed factory overhead is allocated using direct labour hours. The following estimated costs were provided: Direct material $ 80,000 Direct labour 600,000 Variable manufacturing overhead 50,000 Fixed factory overhead costs 20,000 Total $750,000 During the year 8,000 units were produced, and 7,000 units was sold.

Turn received an order for 3,000 units from a new customer in a country in which Turn has never done business. This customer has offered $73.50 per widget. Should Turn accept the order?

A. Yes, because the price of $73.50 is greater than the cost of $73 under variable costing B. Yes, because the price of $73.50 is greater than the cost of $50 under absorption costing C. No, because the price of $73.50 is lower than the cost of $75 under absorption costing D. No, because the price is $73.50 is lower than the sale price of $80.

(Answer should be A)

Question: Unit production cost under variable costing is $21, and $28 under absorption costing. Net income under variable costing was $245,000 and $187,600 under absorption costing last year. Production equalled 67,000 units. How many units did they sell?

A. 75,200 B. 58,800 C. 74,000 D. 60,000

(Answer should be A)