Indiana Hot Tubs,Inc.reports the following information for August: $$\begin{array} { | l | r | }
\hline \text { Sales Revenue } & \$ 650,000 \
\hline \text { Variable Costs } & 270,000 \
\hline \text { Fixed Costs } & 73,000 \
\hline
\end{array}$$ Calculate the operating income for August using variable costing.
A)$380,000
B)$577,000
C)$307,000
D)$650,000

Question

Indiana Hot Tubs,Inc.reports the following information for August: $$\begin{array} { | l | r | } 
\hline \text { Sales Revenue } & \$ 650,000 \
\hline \text { Variable Costs } & 270,000 \
\hline \text { Fixed Costs } & 73,000 \
\hline
\end{array}$$ Calculate the operating income for August using variable costing.
A)$380,000
B)$577,000
C)$307,000
D)$650,000

Quizplus · Accepted Answer

Operating income using variable costing is calculated as Sales Revenue minus Variable Costs and Fixed Costs. So, $650,000 - $270,000 - $73,000 = $307,000.

Indiana Hot Tubs,Inc Calculate the Operating Income for August Using Variable Costing