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It costs Homer's Manufacturing $0.45 to produce baseballs and Homer sells them for $5 a piece. Homer pays a sales commission of 5% of sales revenue to his sales staff. Homer also pays $12,000 a month rent for his factory and store, and also pays $79,000 a month to his staff in addition to the commissions. Homer sold 68,500 baseballs in June. If Homer prepares a contribution margin income statement for the month of June, what would be his contribution margin? O A. $342,500 OB. $294,550 O C. $390,450 O D. $47,950 Lucas Industries uses departmental overhead rates to allocate its manufacturing overhead to jobs. The company has two departments: Assembly and Sanding. The Assembly Department uses a departmental overhead rate of $40 per machine hour, while the Sanding Department uses a departmental overhead rate of $10 per direct labor hour. Job 603 used the following direct labor hours and machine hours in the two departments: Assembly Department Sanding Department Actual results Direct labor hours used Machine hours used 7 11 The cost for direct labor is $40 per direct labor hour and the cost of the direct materials used by Job 603 is $1,400. How much manufacturing overhead would be allocated to Job 603 using the departmental overhead rates? O A. $560 O B. $510 O c. $480 OD. $1,000 It costs Homer's Manufacturing $0.65 to produce baseballs and Homer sells them for $7.00 a piece. Homer pays a sales commission of 5% of sales revenue to his sales staff. Homer also pays $17,000 a month rent for his factory and store, and also pays $76,000 a month to his staff in addition to the commissions. Homer sold 67,500 baseballs in June. If Homer prepares a traditional income statement for the month of June, what would be his gross profit? O A. $516,375 O B. $472,500 O C. $428,625 OD. $43,875

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