Calculate the operating income before taxes

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Reference no: EM132547639

Fresh Air Products manufactures and sells a variety of camping products. Recently the company opened a new plant to manufacture a deluxe portable cooking unit.

Cost and sales data for the first month of operations are shown below:

Beginning inventory 0 units

Units produced 11,600

Units sold 10,200

Manufacturing costs

Fixed overhead $127,600

Variable overhead $7 per unit

Direct labour $10 per unit

Direct material $30 per unit

Selling and administrative costs

Fixed $192,200

Variable $3 per unit sold

The portable cooking unit sells for $112. Management is interested in the opening month's results and has asked for an income statement.

Question 1: Assuming the company uses absorption costing, Calculate the Operating Income before taxes.

Reference no: EM132547639

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