Trevorrow Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During June, the company budgeted for 6,200 units, but its actual level of activity was 6,160 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for June:
Data used in budgeting:
Actual results for June:

-The net operating income in the planning budget for June would be closest to:
A) $21,220
B) $20,696
C) $30,674
D) $30,279

Question

Trevorrow Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During June, the company budgeted for 6,200 units, but its actual level of activity was 6,160 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for June:
Data used in budgeting:
  Actual results for June:
 
-The net operating income in the planning budget for June would be closest to:
A) $21,220 
B) $20,696 
C) $30,674 
D) $30,279

Quizplus · Accepted Answer

11ea7761_1771_5dbb_81a5_b1c8dff230c5_TB2580_00 Net operating income = ($13.10 × 6,200) − $60,000 = $21,220

Trevorrow Corporation Manufactures and Sells a Single Product