(Appendix 5A)Sagon Corporation Manufactures and Sells One Product

question 26

Multiple Choice

(Appendix 5A) Sagon Corporation manufactures and sells one product.The following information pertains to the company's first year of operations: The company does not have any variable manufacturing overhead costs or variable selling and administrative costs.During its first year of operations, the company produced 29, 000 units and sold 23, 000 units.The company's only product is sold for $231 per unit. The net operating income for the year under super-variable costing is:

• A)$782, 000
• B)$446, 000
• C)($202, 000)
• D)$296, 000

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Definitions:

Workers' Compensation Insurance

Insurance that provides wage replacement and medical benefits to employees injured in the course of employment.

General Liability Insurance

A type of insurance coverage that provides protection against claims of bodily injury, property damage, and personal and advertising injury that a business could face.

Trade Fixture Installer

A professional who installs equipment or machinery, which is necessary for a business and may legally be removed by the tenant at the end of a lease.

Testator

One who makes and executes a will.