Figure 8-1. Last year, Fabre Company produced 20,000 units and sold 18,000 units at a price of $12. Costs for last year were as follows:

Direct materials $25,000

Direct labor 35,000

Variable factory overhead 12,000

Fixed factory overhead 37,000

Variable selling expense 9,000

Fixed selling expense 7,500

Fixed administrative expense 15,500

Fixed factory overhead is applied based on expected production. Last year, Fabre expected to produce 20,000 units.

32. Refer to Figure 8-1. Assuming that beginning inventory was zero, what is the value of ending inventory under absorption costing?

a. $5,480 b. $4,500 c. $10,900 d. $12,600 e. $5,750

33. Refer to Figure 8-1. Assuming that beginning inventory was zero, what is the value of ending inventory under variable costing?

a. $3,300 b. $2,500 c. $5,000 d. $3,720 e. $7,200

34. Refer to Figure 8-1. What is operating income for last year under absorption costing?

a. $41,000 b. $67,520 c. $85,900 d. $111,300 e. $45,000

35. Refer to Figure 8-1. What is operating income for last year under variable costing?

a. $111,800 b. $91,780 c. $82,200 d. $78,400 e. $66,350