Springer Began Business at the Start of the Current Year

question 36

Multiple Choice

Springer began business at the start of the current year. The company planned to produce 40,000 units, and actual production conformed to expectations. Sales totaled 37,000 units at $42 each. Costs incurred were: $\begin{array}{lr}\text { Variable manufacturing overhead per unit } & \$ 19 \\\text { Fixed manufacturing overhead } & 240,000 \\\text { Variable selling and administrative cost per unit } & 7 \\\text { Fixed selling and administrative cost per unit } & 140,000\end{array}$ If there were no variances, the company's absorption-costing income would be:

• A) $155,000.
• B) $230,000.
• C) $240,500.
• D) $592,000.
• E) None of the other answers are correct.

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