Pluto Hand blenders Company sold 2,000 units in October at a price of $35 per unit.The variable cost is $20 per unit.The monthly fixed costs are $10,000.What is the operating income earned in October?

Question

Quizplus · Accepted Answer

Operating income = (Price per unit x Units sold) - (Variable cost per unit x Units sold) - Fixed costs
Operating income = ($35 x 2,000) - ($20 x 2,000) - $10,000
Operating income = $70,000 - $40,000 - $10,000
Operating income = $20,000

Pluto Hand Blenders Company Sold 2,000 Units in October at a Price