Platz Company makes chairs.The budgeted selling price is $45 per chair,the variable rate is $15 per chair and budgeted fixed costs are $40,000 per month.What is the budgeted operating income for 3,200 chairs sold in a month?

Question

Quizplus · Accepted Answer

C)
Revenue (# of units × selling price per unit)3,200 × 45 = $144,000
Variable Costs (# of units × variable cost per unit)3,200 × 15 = $48,000
Fixed costs $40,000
Total expenses 48,000 + 40,000 = $88,000
Operating income 144,000 - 88,000 = $56,000

Platz Company Makes Chairs