Use the Following Information for the Next 4 Questions

question 135

Multiple Choice

Use the following information for the next 4 questions.
Baylor, Inc. just finished its second year of operations. In the first year it produced 1,000 units and sold 400. The second year resulted in the same production level, but sales were 1,200 units. The variable costing income statements for both years are shown below:
-The operating income for year 1 using absorption costing would be

• A) $6,000
• B) $(9,000)
• C) $(9,800)
• D) $600

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Definitions:

Fraudulent Misrepresentation

A false statement of fact made with knowledge of its falsity, intended to induce another to act, resulting in harm.

Punitive Damages

Damages exceeding simple compensation and awarded to punish the defendant for egregious behavior or acts.

Tort Of Deceit

A civil wrong involving intentional misrepresentation, leading another to suffer damages.