Question

Dapple Company incurred the following costs while producing 480 ​units: direct​ materials, $11 per​ unit; direct​ labor, $29 per​ unit; variable manufacturing​ overhead, $13 per​ unit; total fixed manufacturing overhead​ costs, $7,680​; variable selling and administrative​ costs, $3 per​ unit; total fixed selling and administrative​ costs, $4,320. There are no beginning inventories. What is the operating income using absorption costing if 480480 units are sold for $180 ​each?

Answer 1

Net operating profit= 47,520

Step-by-step explanation:

Giving the following information:

direct​ materials, $11 per​ unit; direct​ labor, $29 per​ unit; variable manufacturing​ overhead, $13 per​ unit; total fixed manufacturing overhead​ costs, $7,680​; variable selling and administrative​ costs, $3 per​ unit; total fixed selling and administrative​ costs, $4,320. There are no beginning inventories.

Income statement:

Sales= 86,400

COGS= (11+29+13)*480 + 7680= (33,120)

Gross profit= 53,280

Selling and administrative costs= (3*480)+4320= (5,760)

Net operating profit= 47,520