Compute the absorption-costing operating income for the following:
B. Inventory: 0
Production: 480,000 units
Ending Inventory: 30,000 units
Sales: 450,000 units
Selling Price = $79.20
Standard variable costs per unit:
Direct Materials: $24.00
Direct Manuf labor: $6.00
Manufacturing Overhead: $14.40
Variable Marketing: $4.80
Standard Fixed costs:
Manufacturing overhead: $10,800,000
The manufacturing overhead is allocated to each unit based on standard machine-hours. Each unit has a standard machining of 30 minutes.
The denominator level is the master-budget capacity utilization of 500,000 units.
All variances are recorded as a cost of the period in which they are incurred.© BrainMass Inc. brainmass.com June 4, 2020, 12:34 am ad1c9bdddf
The solution computes the absorption-costing operating income with the given data in excel.