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padilas [110]
3 years ago
6

Terry's Appliances manufactures and sells parts for the new washer. The parts for the new washers sell for $60, and the variable

operating cost per unit are $10.
Business
1 answer:
scoundrel [369]3 years ago
4 0

Answer:

$1,550,000

Explanation:

The computation of the operating income is shown below:

As we know that

Operating income = Sales - variable cost - fixed cost

where,

Sales = 32,000 parts × $60

        = $1,920,000

Variable cost = 32,000 parts × $10

                      = $320,000

And, the fixed cost is $50,000

So, the operating income is

= $1,920,000 - $320,000 - $50,000

= $1,550,000

We simply applied the above formula to determine the operating income

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