Hansen Company produces a single product. During the last year, Hansen had net o

Question

Hansen Company produces a single product. During the last year, Hansen had net operating income under absorption costing that was $15,390 lower than its income under variable costing. The company sold 18,400 units during the year, and its variable costs were $22 per unit, of which $10 was variable selling expense. If fixed production cost is $9 per unit under absorption costing every year, then how many units did the company produce during the year?

Hansen Company produces a single product. During the last year, Hansen had net operating income under absorption costing that was $15,390 lower than its income under variable costing. The company sold 18,400 units during the year, and its variable costs were $22 per unit, of which $10 was variable selling expense. If fixed production cost is $9 per unit under absorption costing every year, then how many units did the company produce during the year?

Explanation / Answer

Answer is 16690

net operating income under absorption costing is lower than variable costing by $ 15390 due to units produced is less than units sold therby fixed ovehead in opennig stock will included in absorbtion costing

net operating income under absorption costing is lower than variable costing by $ 15390 due to units produced is less than units sold therby fixed ovehead in opennig stock will included in absorbtion costing

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