Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. arealast year, richmond company produced 10,000 un

AreaLast year, Richmond Company produced 10,000 units and sold 6,000 units at a price of...

80.2K

Verified Solution

Question

Accounting

AreaLast year, Richmond Company produced 10,000 units and sold 6,000 units at a price of $20. Costs for last year were as follows:
Line Item Description Amount
Direct materials $30,000
Direct labor 38,000
Variable factory overhead 8,000
Fixed factory overhead 40,000
Variable selling expense 5,000
Fixed selling expense 4,900
Fixed administrative expense 11,000
Fixed factory overhead is applied based on expected production. Last year, Richmond expected to produce 10,000 units.
Assuming that beginning inventory was zero, what is the operating income for last year under absorption costing?
a. $29,500
b. $29,340
c. $12,430
d. $39,000
e. $55,000

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students