Assume the following information for a company that produced 10,000 units and sold 8,000 units during its first year of operations and produced 8,000 units and sold 10,000 units during its second year of operations: Per Unit Per Year Selling price $ 200 Direct materials $ 73 Direct labor $ 50 Variable manufacturing overhead $ 11 Sales commission $ 8 Fixed selling and administrative expense $ 110,000 Fixed manufacturing overhead $ 300,000 Using absorption costing, what is the net operating income for the second year of operations? Multiple Choice $130,000 $110,000 $160,000 $140,000
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Kk.4.
Assume the following information for a company that produced 10,000 units and sold 8,000 units during its first year of operations and produced 8,000 units and sold 10,000 units during its second year of operations: Per Unit Per Year Selling price $ 200 Direct materials $ 73 Direct labor $ 50 Variable manufacturing
Multiple Choice
$130,000
$110,000
$160,000
$140,000
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where did the fixed sellind and admin $110,000 come from
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