Question
Mouse Corp. began operations on January 1, 20X1. The company sells a single product for $60 per unit. During 20X1, 20,000 units were produced and
Mouse Corp. began operations on January 1, 20X1. The company sells a single product for $60 per unit. During 20X1, 20,000 units were produced and 15,000 were sold. No work-in-process inventories were present on December 31, 20X1.
Costs during 20X1 were as follows:
Fixed variable
direct materials 0 5.00 per unit produced
Direct Labor 0 12.00 per unit produced
Manufacturing overhead 44,000 4.00 per unit produced
Selling and admin expenses 30,000 2.00 per unit sold
The company computes their fixed manufacturing overhead rate for absorption-costing purposes using an expected production level of 22,000 units. The actual fixed overhead for the year was equal to the budgeted amount.
The income under the variable-costing approach for Mouse Corp. for the year 20X1 would be _____.
Question options:
| $491,000
|
| $481,000
|
| $477,000
|
| $487,000
|
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