In order to calculate The net operating income for the month under variable costing for Farron Corporation we would have to make the following calculations:

According to the given data:

i) Direct Material=$32

ii) Direct labor=$74

iii) Variable manufacturing overhead= $20

Hence, Variable costing unit product cost (i + ii + iii)= $126

A) Sales ($168 per unit * 9250 units sold)=$1,554,000

B) Less variable expenses:

Variable cost of goods sold

($126 per unit * 9250 units sold)=$1,165,500

Variable selling and administrative

($24 per unit × 9250 units) $222,000 $1,387,500

C) Contribution margin (A – B)=$166,500

D) Less : fixed expenses

Fixed manufacturing overhead= $144,750

Fixed selling and administrative $10,200 $154,950

E) Net operating Income ( C-D)=$11,550

The net operating income for the month under variable costing is $11,550

4 0

2 years ago

LETS MAKE THIS A QUESTION THAT HAS NO STARS. ONLY THANKS!!!!!!!

sasho [114]

Answer:

Please ask study related questions,mate.

5 0

3 years ago

Which statement best describes a pure market economy?

natulia [17]

C. The decisions made by producers and consumers drive all economic choices.

5 0

3 years ago

Read 2 more answers

Oriole Realty Corporation purchased a tract of unimproved land for $132,000. This land was improved and subdivided into building

finlep [7]

Answer:

Net income 29503

Explanation:

First we need to allocate the land and improvement cost over the lots, we are going to do so based on the revenue:

groups NºLot $ per Lot Revenue Cost per Group Per lot

A 9 7200 64,800 44,937.4648 4,993.0516

B 15 9600 144,000 99,861.0329 6657.4022

C 17 5760 97,920 67,905.5023 3,994.4413

Total Revenue 306720

We divide the group revenue over the total revenue and multiply by the land

and land improvements

Then we take the allocation per group and divde over the total number of lot

We do the same with the allocate expenses:

groups NºLot $ per Lot Revenue Cost per Group Per lot

A 9 7200 64800 9228.169 1025.3521

B 15 9600 144000 20507.0423 1367.1362

C 17 5760 97920 13944.7887 820.2817

Total revenue 306720

Next we solve for the sol lots:

A 9 lots less 5 unsold = 4

B 15 lots less 7 unsold = 8

C 17 lots less 2 unsold = 15

And we proceeds to do the income statement

Revenue sold x market price

Group A 4 28800

Group B 8 76800

Group C 15 86400

192000

Cost lot sold x (allocate operating + allocate land and improvements)

group A 24073.6148

group B 48147.2296

group C 90276.0555

Total expenses 162496.8999

Net income 29503

3 0

3 years ago