How many units were produced this year

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Question - At the beginning of the year, Smith Inc. budgeted the following:

Units 8,000

Sales $100,000 Minus

Total variable expenses 60,000

Total fixed expenses 20,000

Net income $20,000

Factory Overhead

Variable $30,000

Fixed 10,000

There were no beginning inventories. At the end of the year, no work was in process, total actual factory overhead incurred was $37,500 versus the $40,000 estimated. Total applied overhead for the year was $39,000 and it was applied on the basis of budgeted unit production. Factory overhead was applied on the basis of budgeted unit production. How many units were produced this year?

A. 7,200

B. 8,000

C. 7,800

D. 7,500

Reference no: EM132934530

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