Gordon Company Produces a Single Product That Sells for $10

question 77

Multiple Choice

Gordon Company produces a single product that sells for $10 per unit. Last year there were no beginning inventories, 100,000 units were produced, and 80,000 units were sold. The company has the following cost structure:
-Net operating income under variable costing would be:

• A)$114,000
• B)$210,000
• C)$234,000
• D)$330,000

---

Definitions:

Conversion

The unauthorized act of taking someone else's property and converting it into one's own use, which infringes on the legal rights of the owner.

Promissory Note

A financial instrument that contains a written promise by one party to pay another party a specific sum of money either on demand or at a specified future date.

Cancellation

The act of declaring a contract or agreement null and void, thereby releasing the parties from their obligations under the contract.

Comparative Negligence

A legal doctrine that allocates the responsibility and damages in an accident proportionally to the degree of fault of each party involved.