Reference no: EM132783801

The Allen Company had the following absorption costing income statement for the month of July 31, 2020:

Allen Company Income Statement For the Month Ending July 31, 2020

Sales ($60 X 10,000) $600,000

Cost of goods sold:

Direct materials ($12 X10,000) $120,000

Direct labor ($9 X 10,000) 90,000

Variable factory overhead ($7.50 X 10,000) 75,000

Fixed factory overhead 120,000 405,000

Gross profit $195,000

Selling and administrative expenses:

Variable ($1.50 X10,000) $ 15,000

Fixed 90,000 105,000

Operating income $ 90,000

problem 1: Allen Company's break-even volume in units is