Reference no: EM132536356

Question - Dear John is a manufacturer that makes one product. It provided the following information to help prepare the master budget for the upcoming month:

The budgeted selling price per unit is $51. Budgeted unit sales for the month is 22,000 units.

Each unit of finished goods requires 5 pounds of raw materials. The raw materials cost $2.20 per pound.

The direct labor wage rate is $12.00 per hour. Each unit of finished goods requires 1.25 direct labor-hours.

Manufacturing overhead is entirely variable and is $4.00 per direct labor-hour.

The variable selling and administrative expense per unit sold is $2.00. The fixed selling and administrative expense per month is $55,000.

Compute the estimated net operating income (loss) for the month?

a. $341,000

b. $682,000

c. $440,000

d. $1,122,000

e. $396,000