During Its Most Recent Fiscal Year,Dover,Inc

question 66

Multiple Choice

During its most recent fiscal year,Dover,Inc.had total sales of $3,200,000.Contribution margin amounted to $1,500,000 and pretax income was $400,000.What amount should have been reported as variable costs in the company's contribution margin income statement for the year?

• A)$1,900,000.
• B)$2,800,000.
• C)$1,300,000.
• D)$1,100,000.
• E)$1,700,000.

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Definitions:

Direct Labor-Hours

Direct labor-hours refer to the total hours worked by employees directly involved in the production process, used as a basis for allocating labor costs to products.

Machine-Hours

The total hours that machinery is operated during a specific period for production purposes.

Departmental Predetermined Overhead Rates

These rates are calculated to allocate manufacturing overhead costs to specific departments, based on estimated or actual overhead and activity levels.

Machine-Hours

A measure of production time using machinery; used as a basis for allocating manufacturing overhead costs to products.