Question

Helmers Corporation manufactures a single product. Variable costing net operating income last year was $74,000 and this year was $88,700. Last year, $27,600 in fixed manufacturing overhead costs were released from inventory under absorption costing. This year, $10,400 in fixed manufacturing overhead costs were deferred in inventory under absorption costing. What was the absorption costing net operating income last year

Answer 1

Answer:

$46,400

Explanation:

The computation of the absorption costing net operating income last year is shown below:

= Net operating income under variable costing + Fixed overhead deferred in ending inventory - Fixed overhead released in beginning inventory

= $74,000 + $0 - $27,600

= $46,400

All other information which is given in the question is not relevant. Hence, ignored it