Reference no: EM132514116

The Snow Company began the year with no inventories of work in process or finished goods. The company projected the following costs for the year:

Variable costs:

Direct materials                        $18 per unit

Direct labour                             $12 per unit

Manufacturing overhead               $ 8 per unit

Selling expenses                          $ 4 per unit

Fixed costs:

Manufacturing overhead              $90,000 per month

Selling and administrative             $40,000 per month

During the first three months of the year, production and sales in units were as follows:

                           Production                       Sales

January                    30,000                      30,000

February                 30,000                        26,000

March                          30,000                     34,000

• The company sells its product for $60 per unit. Actual costs were as projected for the first three months. There were no work in process inventories at the end of each month.

Question 1: Income for February under absorption costing would be: