Docherty,Inc The Operating Income Calculated Using Variable Costing and Absorption Costing

question 126

Multiple Choice

Docherty,Inc.reports the following information for the year ended December 31: $$\begin{array} { | l | r | l | } \hline \text { Units sold } & 600 & \text { units } \\\hline \text { Sales price } & \$ 120 & \text { per unit } \\\hline \text { Direct materials } & \$ 29 & \text { per unit } \\\hline \text { Direct labor } & \$ 8 & \text { per unit } \\\hline \text { Variable manufacturing overhead } & \$ 13 & \text { per unit } \\\hline \text { Fixed manufacturing overhead } & \$ 25 & \text { per unit } \\\hline \text { Variable selling and administrative costs } & \$ 5 & \text { per unit } \\\hline \text { Fixed selling and administrative costs } & \$ 14,500 & \text { per year } \\\hline\end{array}$$ The operating income calculated using variable costing and absorption costing amounted to $9800 and $11,000,respectively.There were no beginning inventories.Determine the total number of units produced during the year.

• A)600 units
• B)648 units
• C)10 units
• D)48 units

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Definitions:

LSD

Lysergic acid diethylamide, a powerful hallucinogenic drug that alters perception and can cause vivid hallucinations.

Psilocybin

A naturally occurring psychedelic compound produced by more than 200 species of mushrooms, known for its hallucinogenic effects.

Psychosis

A mental disorder characterized by a disconnection from reality, which may include delusions, hallucinations, and disordered thinking.

Alcohol

A chemical compound, specifically ethanol, which is found in drinks like beer, wine, and spirits, and can alter consciousness and impair cognitive and motor functions.