Timmer Corporation just started business in January. There were no beginning inv

Question

Timmer Corporation just started business in January. There were no beginning inventories. During the year, it manufactured 12,000 units of product, and sold 8,400 units. The selling price of each unit was $26. Variable manufacturing costs were $4 per unit, and variable selling and administrative costs were $3 per unit. Fixed manufacturing costs were $24,000, and fixed selling and administrative costs were $8,200.

What would Timmer's net income be for the year using variable costing?

a.$127,400

b.$135,600

c.$101,920

d.$159,600

Explanation / Answer

Calcualte net operating income under variable costing ;

so answer is a) $127400

Sales (8400*26) 218400 Variable cost (4+3)*8400 -58800 Contribution margin 159600 Fixed cost (24000+8200) -32200 Net operating income 127400

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.