Leslie Manufacturing Reported the Following What Is Leslie's Operating Income?
A) $186,000
B) $128,000
C)

question 154

Multiple Choice

Leslie Manufacturing reported the following: $$\begin{array} { | l | r | } \hline\text { Revenue } & \$ 450,000 \\\hline \text { Beginning inventory of direct materials, January 1, 2015 } & 20,000 \\\hline \text { Purchases of direct materials } & 156,000 \\\hline \text { Ending inventory of direct materials, December 31, 2015 } & 18,000 \\\hline \text { Direct manufacturing labor } & 21,000 \\\hline \text { Indirect manufacturing costs } & 42,000 \\\hline \text { Beginning inventory of finished goods, January 1, 2015 } & 40,000 \\\hline \text { Cost of goods manufactured } & 114,000 \\\hline \text { Ending inventory of finished goods, December 31, 2015 } & 45,000 \\\hline \text { Operating costs } & 150,000 \\\hline\end{array}$$ What is Leslie's operating income?

• A) $186,000
• B) $128,000
• C) $177,000
• D) $191,000

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Definitions:

Transfer Prices

The prices at which services, goods, or capital are exchanged between departments or divisions within the same company or between subsidiaries.

Intermediate Products

Goods that are used as inputs in the production of other goods, not intended for final consumption.

Profit Center

A branch or division of a company that is directly responsible for generating its own revenue and profits.

Division Profit

This refers to the net income generated by a specific division or segment of a larger company.