6.Loring Company had the following data for the month:

Variable costs per unit:
Direct materials	$4.00
Direct labor	3.20
Variable overhead	1.00
Variable selling expenses	.40

Fixed overhead is $4,000 per month; it is applied to production based on normal activity of 2,000 units. During the month, 2,000 units were produced. Loring started the month with 300 units in beginning inventory, with unit product cost equal to this month's unit product cost. A total of 2,100 units were sold during the month at price of $14. Selling and administrative expense for the month, all fixed, totaled $3,600.

Refer to Figure 8-2. What is operating income under variable costing?

a.$3,540

b.$7,980

c.-$540

d.$11,340

e.$3,740

7.

Loring Company had the following data for the month:

Variable costs per unit:
Direct materials	$4.00
Direct labor	3.20
Variable overhead	1.00
Variable selling expenses	.40

Fixed overhead is $4,000 per month; it is applied to production based on normal activity of 2,000 units. During the month, 2,000 units were produced. Loring started the month with 300 units in beginning inventory, with unit product cost equal to this month's unit product cost. A total of 2,100 units were sold during the month at price of $14. Selling and administrative expense for the month, all fixed, totaled $3,600.

Refer to Figure 8-2. What is the unit product cost under variable costing?

a.$8.20

b.$10.20

c.$10.60

d.$7.20

e.$8.60

8.

Loring Company had the following data for the month:

Variable costs per unit:
Direct materials	$4.00
Direct labor	3.20
Variable overhead	1.00
Variable selling expenses	.40

Fixed overhead is $4,000 per month; it is applied to production based on normal activity of 2,000 units. During the month, 2,000 units were produced. Loring started the month with 300 units in beginning inventory, with unit product cost equal to this month's unit product cost. A total of 2,100 units were sold during the month at price of $14. Selling and administrative expense for the month, all fixed, totaled $3,600.

Refer to Figure 8-2. What is operating income under absorption costing?

a.$7,980

b.-$540

c.$3,740

d.$11,340

e.$3,540

9.

Rodriquez Company budgeted the following sales in units:

January	30,000
February	20,000
March	40,000

Rodriquez's policy is to have 20% of the following month's sales in inventory. On January 1, inventory equaled 7,500 units. February production in units is:

a.20,000.

b.28,000.

c.24,000.

d.40,000.

e.26,500.