Jasper Enterprises had the following cost and production information for Aprit U

Question

Jasper Enterprises had the following cost and production information for Aprit Units Produced Unas Sold Unit Sales Price 20,000 17,000 $ 200 Direct Moterial Direct Labor Variable Manufacturing Overhead Fbued manufactuing averhead Full Manufacturing Cost Per Unit 50 25 ($400000/20,000) $ 20 105 Variable Selling Expenses Fbed General and Administretive Costs $ 80,00 s 75.000 How much greater will Jasper Enterprises' income be under absorption costing than under variable costing O $400000 $60,000 O $340.000 $315,000

Explanation / Answer

Jasper Enterprises income be under absorption costing than variable costing is: $60,000

Explanation:

$95 - $75 = $20

Inventory increased by 3,000 units during April.

$20 * 3,000 = $60,000

Absorption Costing Variable Costing Direct Materials $50 $50 Direct Labor 25 25 Variable manufacturing overhead 10 10 Fixed manufacturing overhead 20 - $95 $75

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