Question
Crystal Corporation produces a single product. The company's variable costing income statement for the month of May appears below: Crystal Corporation Income Statement For the
Crystal Corporation produces a single product. The company's variable costing income statement for the month of May appears below: Crystal Corporation Income Statement For the month ended May 31 Sales ($10 per unit) $1,120,000 Variable expenses: Variable cost of goods sold 560,000 Variable selling expense 112,000 Total variable expenses 672,000 Contribution margin 448,000 Fixed expenses: Fixed manufacturing overhead 250,000 Fixed selling and administrative 112,000 Total fixed expenses 362,000 Net operating income $86,000 The company produced 100,000 units in May and the beginning inventory consisted of 30,000 units. Variable production costs per unit and total fixed costs have remained constant over the past several months. The value of the company's inventory on May 31 under absorption costing would be: $90,000 $215,000 $72,000 $135,000
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