Buckbee Corporation Manufactures and Sells One Product

question 262

Multiple Choice

Buckbee Corporation manufactures and sells one product. The following information pertains to the company's first year of operations: 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 37,000 units and sold 32,000 units. The company's only product is sold for $261 per unit.Assume that the company uses a variable costing system that assigns $17 of direct labor cost to each unit that is produced. The net operating income under this costing system is:

• A) $1,184,000
• B) $229,000
• C) $714,000
• D) $799,000

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Definitions:

Standard Error

A statistical term that measures the accuracy with which a sample distributes around the population mean; it is the standard deviation of the sampling distribution.

Sampling Distribution

The probability distribution of a given statistic based on a random sample, used to estimate population parameters.

Formal Charge

Used to calculate the charge of an atom in a molecule, assuming that electrons in all chemical bonds are shared equally between atoms.

Nitrogen

A chemical element with symbol N and atomic number 7, essential for life and a major component of the Earth's atmosphere.