Eagle Corporation Manufactures a Picnic Table

question 95

Multiple Choice

Eagle Corporation manufactures a picnic table. Shown below is Eagle's cost structure: In its first year of operations, Eagle produced and sold 10,000 tables. The tables sold for $120 each.
-How would Eagle's absorption costing net operating income have been affected in its first year if 12,000 tables were produced instead of 10,000 and Eagle still sold 10,000 tables?

• A)net operating income would not have been affected
• B)net operating income would have been $27,000 higher
• C)net operating income would have been $31,500 higher
• D)net operating income would have been $116,000 lower

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