Erie Company Manufactures a Single Product There Were No Units in Inventory at the Beginning of for the Year

question 131

Multiple Choice

Erie Company manufactures a single product. Assume the following data for the year just completed:
$\begin{array}{|l|r|}\hline \text { Variable costs per unit: } & \\\hline \text { Manufacturing } & \$ 5 \\\hline \text { Selling and administrative } & \$ 8 \\\hline \text { Fixed costs in total } & \\\hline \text { Manufacturing } & \$ 60,000\\\hline \text { Selling and administrative } & \$ 82,500 \\\hline\end{array}$
There were no units in inventory at the beginning of the year. During the year, 30,000 units were produced and 25,000 units were sold. Each unit sells for $\$ 35$ .
-What was the company's operating income under variable costing?

• A) $407,500.
• B) $417,500.
• C) $421,250.
• D) $431,250.

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