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

question 96

Multiple Choice

Yazzie,Inc.reports the following information for the year ended December 31: $\begin{array}{|l|r|l|}\hline \text { Units sold } & 620 &\text { units } \\\hline \text { Sales price } & { \$160}& \text{ per unit } \\\hline \text { Direct materials } & { \$26}&\text{ per unit } \\\hline \text { Direct labor } & { \$10}&\text{ per unit } \\\hline \text { Variable manufacturing overhead } & \$ 13& \text { per unit } \\\hline \text { Fixed manufacturing overhead } & { \$30}& \text{ per unit } \\\hline \text { Variable selling and administrative costs } & \$ 5& \text { per unit } \\\hline \text { Fixed selling and administrative costs } & \$ 14,200& \text { per year } \\\hline\end{array}$ The operating income calculated using variable costing and absorption costing amounted to $9300 and $11,400,respectively.There were no beginning inventories.Determine the total fixed manufacturing overhead that will be expensed under variable costing for the year 2016.

• A)$20,700
• B)$18,600
• C)$34,720
• D)$30,380

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