Dewiel Corporation manufactures a variety of products. The following data pertain to the company's operations over the last two years:
-What was the absorption costing net operating income last year?
A) $90,900
B) $96,900
C) $84,900
D) $92,100

Question

Dewiel Corporation manufactures a variety of products. The following data pertain to the company's operations over the last two years: 
-What was the absorption costing net operating income last year?
A) $90,900 
B) $96,900 
C) $84,900 
D) $92,100

Quizplus · Accepted Answer

To calculate the absorption costing net operating income last year, we need to use the following formula:

Net Operating Income = Sales - Cost of Goods Sold (COGS) - Selling and Administrative Expenses - Fixed Manufacturing Overhead

Plugging in the values from the table, we get:

Net Operating Income = $1,360,000 - $1,050,000 - $145,000 - $68,100 - $100,900
Net Operating Income = $96,900

Therefore, the absorption costing net operating income last year was $96,900, which corresponds to choice B.

Dewiel Corporation Manufactures a Variety of Products