Answer:
Net operating income= (28,000)
Explanation:
Giving the following information:
Selling price per unit= $73
Total unitary variable production cost= (24 + 16 + 2 + 3)= $45
Fixed manufacturing overhead $ 784,000
Fixed selling and administrative expense $ 672,000
<u>Under the variable costing method, the fixed manufacturing overhead is a period cost instead of a product cost.</u>
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Variable costing income statement:
Sales= 73*51,000= 3,723,000
Total variable cost= 51,000*45= (2,295,000)
Contribution margin= 1,428,000
Fixed manufacturing overhead= (784,000)
Fixed selling and administrative expense= (672,000)
Net operating income= (28,000)
