Front Company Had Net Income of $72,500 Based on Variable

question 32

Multiple Choice

Front Company had net income of $72,500 based on variable costing.Beginning and ending inventories were 800 units and 1,200 units,respectively.Assume the fixed overhead per unit was $7.90 for both the beginning and ending inventory.What is net income under absorption costing?

• A)$69,340
• B)$75,660
• C)$88,300
• D)$56,700
• E)$72,900

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Definitions:

Redbox

A company specializing in DVD, Blu-ray, and video game rentals via automated retail kiosks.

Form Of Ownership

The legal structure of a business, such as sole proprietorship, partnership, or corporation, which has implications for taxation, liability, and governance.

Franchise Operations

Business models where an individual or group is granted the rights to operate a business using the branding and system of an established company.

Inventory Management

The process of ordering, storing, using, and selling a company's inventory, including the management of raw materials, components, and finished products.