1. The Colin Division of Mochrie Company sells its product for $38 per unit. Variable costs per unit are: manufacturing, $12; and selling and administrative, $3. Fixed costs are: $240000 manufacturing overhead, and $59000 selling and administrative. There was no beginning inventory. Expected sales for next year are 40000 units. Ryan Stiles, the manager of the Colin Division, is under pressure to improve the performance of the Division. As he plans for next year, he has to decide whether to produce 40000 units or 50000 units. What would the net income be under absorption costing for each alternative? 40000 units 50000 units

A	$621000 $621000

B	$621000 $669000

C	$621000 $680800

D	$669000 $621000

2.

M&Hs unit production cost under variable costing is $28, and $35 under absorption costing. Net income under variable costing was $236000 and $173700 under absorption costing last year. Production equalled 60000 units. How many units did M&H sell?

A

68900

B

51100

C

67000

D

53000