Selected Data for Lemon Grass,Inc What Is the Total Manufacturing Overhead?
A) $442,000
B) $56,000

question 189

Multiple Choice

Selected data for Lemon Grass,Inc.for the year are provided below: $\begin{array} { | l | r | } \hline \text { Factory Utilities } & \$ 1000 \\\hline \text { Indirect Materials Used } & 34,000 \\\hline \text { Direct Materials Used } & 292,000 \\\hline \text { Property Taxes on Factory Building } & 5900 \\\hline \text { Sales Commissions } & 85,000 \\\hline \text { Indirect Labor Incurred } & 22,000 \\\hline \text { Direct Labor Incurred } & 150,000 \\\hline \text { Depreciation on Factory Equipment } & 6800\\\hline \end{array}$ What is the total manufacturing overhead?

• A) $442,000
• B) $56,000
• C) $69,700
• D) $13,700

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Definitions:

Variable Costing

This is an accounting method that only includes variable costs—costs that change with production volume—in the calculation of product cost.

Total Contribution Margin

The difference between total sales revenue and total variable costs, indicating the total earnings available to cover fixed expenses and generate profit.

Variable Costing

An accounting method that only includes variable production costs (materials, labor, and overhead) in product costs, with fixed overhead expenses treated as period costs.

Net Operating Income

Net Operating Income (NOI) is a measure of a company's profitability from its core business operations, excluding expenses and revenues from financing and investing activities.