TB MC Qu. 05-150 Kilihea Corporation produces a...

Kilihea Corporation produces a single product. The company's absorption costing income statement for July follows:

Kilihea Corporation

Income Statement

For the month ended July 31 Sales (18,500 units) $851,000 Cost of goods sold 579,050 Gross margin 271,950 Selling and administrative expenses: Fixed 129,500 Variable 92,500 222,000 Net operating income $49,950

During July, the company's variable production costs were $22.30 per unit and its fixed manufacturing overhead totaled $176,000.

Net operating income under the variable costing method for July would be:

Noreen 4e Rechecks 2017-24-03

$49,950

$59,450

$37,250

$40,450