Neef Corporation has provided the following data for its two most recent years o

Question

Neef Corporation has provided the following data for its two most recent years of operation: Selling price per unit $ 84 Manufacturing costs: Variable manufacturing cost per unit produced: Direct materials $ 12 Direct labor $ 5 Variable manufacturing overhead $ 4 Fixed manufacturing overhead per year $ 432,000 Selling and administrative expenses: Variable selling and administrative expense per unit sold $ 5 Fixed selling and administrative expense per year $ 61,000 Year 1 Year 2 Units in beginning inventory 0 3,000 Units produced 12,000 9,000 Units sold 9,000 10,000 Units in ending inventory 3,000 2,0000 The net operating income (loss) under variable costing in Year 2 is closest to:

Explanation / Answer

Sales revenue 840000 =10000*84 Variable costs: Direct materials 120000 =10000*12 Direct labor 50000 =10000*5 Variable manufacturing overhead 40000 =10000*4 Variable selling and administrative expense 50000 260000 =10000*5 Contribution margin 580000 Fixed costs: Fixed manufacturing overhead 432000 Fixed selling and administrative expense 61000 493000 Net operating income (loss) under variable costing in Year 2 87000

Related Questions

Navigate

• Browse (All)
• Browse N
• Subjects

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