Fanelli Company Had Net Income of $678,000 Based on Variable

question 37

Essay

Fanelli Company had net income of $678,000 based on variable costing.Beginning and ending inventories were 5,000 units and 4,200 units,respectively.Assume the fixed overhead cost per unit was $.50 for both the beginning and ending inventory.What is net income under absorption costing?

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Definitions:

Dollar Amount

A numeric monetary value measured in units of the currency dollar.

Preferred Stock

A type of stock that gives holders preferential treatment over common stockholders, usually through dividends and upon liquidation.

Common Stock

Equity ownership in a corporation, with voting rights and potential for dividends.

Dividend

A distribution of profits by a company to its shareholders, typically in the form of a payment.