DeAnne Company produces a single product. The company\'s variable costing income

Question

DeAnne Company produces a single product. The company's variable costing income statement for the month August appears below:

The company produced 35,750 units in August and the beginning inventory consisted of 8,340 units. Variable production costs per unit and total fixed costs have remained constant over the past several months.

Under absorption costing, for August the company would report a:

A. $4,850 loss

B. $4,850 profit

C. $19,400 profit

D. $35,750 profit

DeAnne Company produces a single product. The company's variable costing income statement for the month August appears below:

Explanation / Answer

Calculate operating income or loss :

so answer is b) $4850 profit

sales revenue 690200 Less: Cost of goods sold (406000+107250) (527800) Gross margin 162400 Less: selling and administrative expenses (121800+35750) (157550) Net operating income 4850

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