Answer:
Fixed manufacturing costs expensed on the income statement (excluding adjustments for variances) total $ 12071.43
Explanation:
Freetown Corporation
Fixed manufacturing costs $26,000
Budgeted denominator level is 2,800 units
Units sold total 1,300
<em>In absorption costing the fixed costs are treated as product costs. </em>
So the Fixed overhead rate will be applied to the units sold
Fixed Overhead Rate= Fixed Costs/ Budgeted Units =
$ 26,000/ 2800= $ 9.285= $ 9.29
Fixed Costs for 1300 units = Fixed OH rate * 1300
=$ 9.29 * 1300= 12071.428= $ 12071.43
Fixed manufacturing costs expensed on the income statement (excluding adjustments for variances) total $ 12071.43