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Question - Use the following information to answer the questions:
Selling price $15.00 per unit sold
Direct material $2.50 per unit produced
Direct labor $3.00 per unit produced
Var MOH $2.00 per unit produced
Fixed MOH $75,000
Fixed S&A $30,000
Units produced 22,000
Units sold 20,000
There were no beginning inventories.
Required -
1. Calculate the net income and cost of the ending inventory using the variable costing method.
2. Calculate the net income and cost of the ending inventory using the absorption costing method.
You are currently selling 25,000 units, your contribution margin per unit is $5, your fixed costs are $100,000. What is your operating leverage
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