Answer:
$101,500
Explanation:
The computation of the net income under the variable costing is shown below:
= Net income + opening inventory - closing inventory
where,
Net income is $114,000
Opening inventory is zero
And, the closing inventory is not given, so we have to compute it
Since the company manufactured 60,000 units and sold 55000 units so, the remaining inventory would be considered as closing units i.e $5,000 (60,000 units - 55,000 units)
Now the fixed manufacturing overhead will be computed for 5,000 units. The calculation is shown below:
= (Fixed manufacturing overhead) × (closing units ÷ number of units manufactured)
= $150,000 × (5,000 units ÷ 60,000 units)
= $12,500
Now put these values to the above formula
So, the value would equal to
= $114,000 + $0 - $12,500
= $101,500
