Alpha Company manufactures a single product, the Whiz Mixer kitchen appliance, which it sells for $32 per unit. Information about costs, production, and sales for the month of March is provided below: Variable Costs Fixed Costs $10.00/unit Manufacturing overhead $23,000 $4.50/unit Selling and Administration $10,000 Variable manufacturing overhead $2.50/unit Units produced in period 6,000 Variable selling/administration $2.00/unit Units sold in period 6,000 Beginning inventory $0 Direct materials Direct labour What is the operating income for Alpha Company under an absorption costing system? O a $57,000 O b. $45.000 O c. $40,000 O d. $67,000

Principles of Accounting Volume 2
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ISBN:9781947172609
Author:OpenStax
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Chapter6: Activity-based, Variable, And Absorption Costing
Section: Chapter Questions
Problem 14EA: Cool Pool has these costs associated with production of 20,000 units of accessory products: direct...
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Alpha Company manufactures a single product, the Whiz Mixer kitchen appliance,
which it sells for $32 per unit. Information about costs, production, and sales for the
month of March is provided below:
Fixed Costs
$10.00/unit Manufacturing overhead $23,000
$4.50/unit Selling and Administration $10,000
Variable manufacturing overhead
$2.50/unit Units produced in period
6,000
Variable selling/administration $2.00/unit Units sold in period
6,000
Beginning inventory
$0
Variable Costs
Direct materials
Direct labour
What is the operating income for Alpha Company under an absorption costing
system?
O a. $57,000
O b.
$45.000
O c.
$40,000
O d.
$67,000
Transcribed Image Text:Alpha Company manufactures a single product, the Whiz Mixer kitchen appliance, which it sells for $32 per unit. Information about costs, production, and sales for the month of March is provided below: Fixed Costs $10.00/unit Manufacturing overhead $23,000 $4.50/unit Selling and Administration $10,000 Variable manufacturing overhead $2.50/unit Units produced in period 6,000 Variable selling/administration $2.00/unit Units sold in period 6,000 Beginning inventory $0 Variable Costs Direct materials Direct labour What is the operating income for Alpha Company under an absorption costing system? O a. $57,000 O b. $45.000 O c. $40,000 O d. $67,000
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