(Appendix 6A) Leheny Corporation manufactures and sells one product. The following information pertains to the company's first year of operations:
The company does not have any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 55,000 units and sold 50,000 units. The company's only product is sold for $238 per unit.
-Assume that the company uses a variable costing system that assigns $21 of direct labor cost to each unit that is produced.The net operating income under this costing system is:
A) $1,400,000
B) $1,005,000
C) $1,110,000
D) $580,000

Question

(Appendix 6A) Leheny Corporation manufactures and sells one product. The following information pertains to the company's first year of operations:
  The company does not have any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 55,000 units and sold 50,000 units. The company's only product is sold for $238 per unit.
-Assume that the company uses a variable costing system that assigns $21 of direct labor cost to each unit that is produced.The net operating income under this costing system is:
A) $1,400,000 
B) $1,005,000 
C) $1,110,000 
D) $580,000

Quizplus · Accepted Answer

11ea7761_184a_f55e_81a5_5b76a2888387_TB2580_00 11ea7761_184b_1c6f_81a5_e30a5d5392c7_TB2580_00

(Appendix 6A) Leheny Corporation Manufactures and Sells One Product