Jupiter Corporation incurred fixed manufacturing costs of $16,000 during 2017.Other information for 2017 includes:
The budgeted denominator level is 2,300 units.
Units produced total 2,600 units.
Units sold total 1,600 units.
Variable cost per unit is $ \$ 4 $
Beginning inventory is zero.
The fixed manufacturing cost rate is based on the budgeted denominator level.
Under variable costing,the fixed manufacturing costs expensed on the income statement (excluding adjustments for variances)total ________.
A)$16,000
B)$11,130
C)$21,530
D)$0

Question

Jupiter Corporation incurred fixed manufacturing costs of $16,000 during 2017.Other information for 2017 includes:
The budgeted denominator level is 2,300 units. 
Units produced total 2,600 units.
Units sold total 1,600 units.
Variable cost per unit is $ \$ 4 $
Beginning inventory is zero.
The fixed manufacturing cost rate is based on the budgeted denominator level.
Under variable costing,the fixed manufacturing costs expensed on the income statement (excluding adjustments for variances)total ________.
A)$16,000
B)$11,130
C)$21,530
D)$0

Quizplus · Accepted Answer

Under variable costing, all fixed manufacturing costs are expensed in the period incurred. Therefore, the entire $16,000 of fixed manufacturing costs is expensed on the income statement.

Jupiter Corporation Incurred Fixed Manufacturing Costs of $16,000 During 2017 $4 \$ 4 $4

Jupiter Corporation Incurred Fixed Manufacturing Costs of $16,000 During 2017 $\$ 4$