Use the following to answer questions 8 and 9:

Princess Ariel Company manufactures and sells two types of beach towels, standard and deluxe.The company budgets the following sales and variable costs for each towel for the upcoming year:

Standard Deluxe

Sales............................................... $450,000 $50,000

Variable expenses ......................... $360,000 $20,000

Princess Ariel also budgets $57,600 in company-wide fixed expenses for the year.

Question 8

1pts

Princess Ariel's budgeted operating income for the year is:

$4,800

$62,400

$32,400

$120,000

Question 9

1pts

Princess Ariel's actual total sales for the year were $500,000; however, sales of Standard towels were $300,000 and sales of Deluxe towels were $200,000.Variable and fixed costs were in line with the budget.Princess Ariel's actual operating income for the year was:

$120,000

$122,400

$74,800

$62,400

Use the following to answer questions 11 and 12:

Quasimodo Company produces and sells only one product.The following data relates to Quasimodo's operations for the year just ended:

Selling price per unit.............................................................................................. $121

Units in beginning finished goods inventory....................................................0

Units produced......................................................................................................... 4,300

Units sold..................................................................................................................... 4,000

Units in ending finished goods inventory....................................................... 300

Variable costs per unit:

Direct materials...........................................$44

Direct labor.................................................$35

Variable manufacturing overhead...............$7

Variable selling and administrative.............$5

Fixed costs:

Fixed manufacturing overhead...................$34,400

Fixed selling and administrative..................$72,000

Question 11

1pts

Quasimodo's operating income for the year under absorption costing is:

$24,100

$16,000

$22,600

$13,600

Question 12

1pts

Quasimodo's operating income for the year under variable costing is:

$24,100

$13,600

$22,600

$16,000