Fasetech,Inc What Is the Operating Income Using Absorption Costing If 500

question 215

Multiple Choice

Fasetech,Inc.has collected the following data.(There are no beginning inventories.) $$\begin{array} { | l | r | } \hline \text { Units produced } & \text { 540 units } \\\hline \text { Sales price } & \$ 140 \text { per unit } \\\hline \text { Direct materials } & \$ 18 \text { per unit } \\\hline \text { Direct labor } & \$ 15 \text { per unit } \\\hline \text { Variable manufacturing overhead } & \$ 9 \text { per unit } \\\hline \text { Fixed manufacturing overhead } & \$ 16,600 \text { per year } \\\hline \text { Variable selling and administrative costs } & \$ 9 \text { per unit } \\\hline \text { Fixed selling and administrative costs } & \$ 10,900 \text { per year } \\\hline\end{array}$$ What is the operating income using absorption costing if 500 units are sold? (Round any intermediate calculations to the nearest cent,and your final answer to the nearest dollar.)

• A) $22,600
• B) $18,230
• C) $25,420
• D) $34,730

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Definitions:

Insurance Contract

A legally binding agreement between an insurer and the insured, outlining the terms for the insurer to compensate the insured for specific losses or damages.

Breach of Contract

Occurs when one party in a binding agreement fails to fulfill their obligations without a legitimate legal excuse.

Obligations

Duties or responsibilities enforced by law, contract, or a sense of duty that compel someone to act or refrain from acting in a certain manner.

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A physical or mental condition that significantly restricts one's ability to perform one or more major life activities.