The company has a maximum production capacity of 100,000 units per year. Operating at normal capacity, the business earned Operating Income of $600,000 in 2020. The following cost data has been prepared   Selling price per unit……………………………………… $50.00 Production Costs: Direct Materials …………………………………. $10.00 Direct Labour ……………………………………. $8.00 Variable Manufacturing Overhead ……………. $7.00 Fixed Manufacturing Overhead…………....................... $450,000 Fixed Selling & Administrative Expenses……………… $300,000 Variable selling expense per unit ………………………. $10.00

FINANCIAL ACCOUNTING
10th Edition
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Author:Libby
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Chapter1: Financial Statements And Business Decisions
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The company has a maximum production capacity of 100,000 units per year. Operating at normal capacity, the business earned Operating Income of $600,000 in 2020. The following cost data has been prepared

 

Selling price per unit……………………………………… $50.00

Production Costs:

Direct Materials …………………………………. $10.00

Direct Labour ……………………………………. $8.00

Variable Manufacturing Overhead ……………. $7.00

Fixed Manufacturing Overhead…………....................... $450,000

Fixed Selling & Administrative Expenses……………… $300,000

Variable selling expense per unit ………………………. $10.00

 

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