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How much would absorption costing operating income differ

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Reference no: EM133532768

Case Study: Markey Co. has the following information for march.

Sales $935,000

Variable cost of goods sold. 485,000

Fixed manufacturing cost. 95,000

Variable selling and adm. cost. 240,100

Fixed selling and adm. Cost 60,700

Determine:

Manufacturing margin
Contribution margin
Net income for the month of march.

BE 21-4 Analyzing income under absorption and variable costing.

Variable manufacturing costs are $126 per unit, and fixed manufacturing costs are $157,500. Sales are estimated to be 10,000 units.

Questions:

  • How much would absorption costing operating income differ between a plan to produce 10,000 units and a plan to produce 15,000 units?
  • How much would variable operating income differ between the two production plans?

Reference no: EM133532768

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