Solution-Find the amount of operating income earned by

Find the amount of operating income earned by Merlene

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Reference no: EM132716637

Problem - Data for the last fiscal year for Merlene Company are as follows:

	Units
Beginning inventory of finished goods	100
Production during the year	700
Sales	750
Ending inventory of finished goods	50

	Per Unit
Product selling price	$200
Variable manufacturing cost	90
Fixed manufacturing cost	20

Budgeted selling and administrative costs (all fixed)	$45,000

Actual selling and administrative costs equaled the budgeted amount, and there were no work in process inventories at the end of the period. Under the variable costing concept, the amount of operating income earned by Merlene for the year was:

a. $21,500.

b. $22,500.

c. $28,000.

d. $31,000.

Reference no: EM132716637

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Find the amount of operating income earned by Merlene

Reference no: EM132716637

Reference no: EM132716637

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