Souffront Corporation Manufactures and Sells One Product

question 238

Multiple Choice

Souffront Corporation manufactures and sells one product. In the company's first year of operations, the variable cost consisted solely of direct materials of $102 per unit. The annual fixed costs were $1,488,900 of direct labor cost, $3,970,800 of fixed manufacturing overhead expense, and $1,735,200 of fixed selling and administrative expense. The company does not have any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 61,800 units and sold 57,800 units. The company's only product is sold for $266 per unit. The net operating income for the year under super-variable costing is:

• A) $2,284,300
• B) $2,749,989
• C) $3,773,200
• D) $6,255,100

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