Solution-Determine the absorption costing net operating

Determine the absorption costing net operating income

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Reference no: EM131807373

Problem - Aerosmith Electric Car Company, which has only one product, has provided the following data concerning its most recent month of operations:

Selling price	$25,000
Units in beginning inventory	1,000
Units produced	7,000
Units sold	3,250
Units in ending inventory	4,750
Variable costs per unit:
Direct materials	$7,800
Direct labor	$5,000
Variable manufacturing overhead	$1,650
Variable selling and administrative	$1,250
Fixed costs:
Fixed manufacturing overhead	$2,500,000
Fixed selling and administrative	$1,950,000

The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month.

Requirements - Show your work. Determine the:

Variable costing net operating income

Absorption costing net operating income

Reference no: EM131807373

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Determine the absorption costing net operating income

Reference no: EM131807373

Reference no: EM131807373

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