Tustin Corporation has provided the following data for its two most recent years of operation: Selling price per unit $ 68 Manufacturing costs: Variable manufacturing cost per unit produced: Direct materials $ 10 Direct labor $ 6 Variable manufacturing overhead $ 4 Fixed manufacturing overhead per year $ 220,000 Selling and administrative expenses: Variable selling and administrative expense per unit sold $ 6 Fixed selling and administrative expense per year $ 61,000 Year 1 Year 2 Units in beginning inventory 0 1,000 Units produced during the year 11,000 10,000 Units sold during the year 10,000 7,000 Units in ending inventory 1,000 4,000 The net operating income (loss) under absorption costing in Year 2 is closest to:
Tustin Corporation has provided the following data for its two most recent years of operation: Selling price per unit $ 68 Manufacturing costs: Variable manufacturing cost per unit produced: Direct materials $ 10 Direct labor $ 6 Variable manufacturing overhead $ 4 Fixed manufacturing overhead per year $ 220,000 Selling and administrative expenses: Variable selling and administrative expense per unit sold $ 6 Fixed selling and administrative expense per year $ 61,000 Year 1 Year 2 Units in beginning inventory 0 1,000 Units produced during the year 11,000 10,000 Units sold during the year 10,000 7,000 Units in ending inventory 1,000 4,000 The net operating income (loss) under absorption costing in Year 2 is closest to:
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
100%
Tustin Corporation has provided the following data for its two most recent years of operation:
| Selling price per unit | $ | 68 |
| Variable manufacturing cost per unit produced: | ||
| Direct materials | $ | 10 |
| Direct labor | $ | 6 |
| Variable manufacturing |
$ | 4 |
| Fixed manufacturing overhead per year | $ | 220,000 |
| Selling and administrative expenses: | ||
| Variable selling and administrative expense per unit sold | $ | 6 |
| Fixed selling and administrative expense per year | $ | 61,000 |
| Year 1 | Year 2 | |
| Units in beginning inventory | 0 | 1,000 |
| Units produced during the year | 11,000 | 10,000 |
| Units sold during the year | 10,000 | 7,000 |
| Units in ending inventory | 1,000 | 4,000 |
The net operating income (loss) under absorption costing in Year 2 is closest to:
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 2 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education