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Clark's Auto Parts manufactures carburetors. Each carburetor is sold for $500. In the month of June, Clark's manufactures 3,000 carburetors and sells 2,600 carburetors. Actual
Clark's Auto Parts manufactures carburetors. Each carburetor is sold for $500. In the month of June, Clark's manufactures 3,000 carburetors and sells 2,600 carburetors. Actual fixed costs are the same as the amount of fixed costs budgeted for the month. Clark's has no beginning inventory. The following information is provided for the month of June: Variable manufacturing costs $120 per unit Fixed manufacturing costs $90,000 per month Fixed Administrative expenses $30,000 per month The company also incurs a sales commission of $11 per unit. What is the operating income when using absorption costing? (Round any intermediary calculations to the nearest cent and your final answer to the nearest dollar.) a. $880,000 b. $851,400 c. $869,400 d. $910,000
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