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Last year, Walsh Company manufactured 25,000 units and sold 22,000 units. Production costs were as follows: Direct materials Direct labour $100,000 75,000 50,000 Variable manufacturing
Last year, Walsh Company manufactured 25,000 units and sold 22,000 units. Production costs were as follows: Direct materials Direct labour $100,000 75,000 50,000 Variable manufacturing overhead Fixed manufacturing overhead 75,000 Total sales were $440,000, total variable selling and administrative expenses were $110,000, and total fixed selling and administrative expenses were $45,000. There was no beginning inventory. Assume that direct labour is a variable cost What was the operating income under variable costing? Select one: a. $12,000 b. $21,000 c. $9,000 d. $2,000
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