Cathy Company is a manufacturer of tables sold to schools, restaurants, hotels, and other institutions. The tabletops are manufactured by Cathy, but the table legs are purchased from an outside supplier. The Assembly Department takes a manufactured tabletop and attaches the four purchased table legs. Assume the required production for August and September is 1,800 and 1.600 tables, respectively. Cathy purchases sufficient direct materials to ensure that direct materials inventory is 60% of the following month's production needs. This requirement was met at the end of July. The number of table legs to be purchased in August is: 7.200 legs 6,880 legs O 1,680 legs 6,720 legs O 6,400 legs Cathy Company manufactures a single type of calculator. In its first year of operations, Cathy a produced and sold 780,000 calculators. What would have happened to operating income in this first year under the following costing methods if Cathy had produced 20.000 more calculators? (Assume that Cathy has both variable and fixed manufacturing overhead costs). O Variable Costing Decrease Absorption Costing Decrease O O Variable Costing Increase Absorption Costing Decrease O Variable Costing Absorption Costing Decrease Increase o Variable Costing Increase Absorption Costing Increase o Variable Costing No Effect Absorption Costing Increase Cathy Company is a retail store that started operations on June 1. For purposes of budget preparation, assume the following: Expected sales for the first four months are: June................ $10,000 . July..... $16,000 August..... $24,000 . September......... ....... $25,000 Cathy's cost of goods sold generally runs at 60 percent of sales. In order to have adequate stocks of inventory on hand, the company attempts to have inventory at the end of each month equal to half of the next month's projected cost of goods sold. Merchandise purchases in August are budgeted to be: $21.900 O $14.700 $7,200 O $14,400 O $14,100