Reference no: EM133187996

Question - Sofie Manufacturers produces decorative pillows and sells them at $96 per unit. In the first month of operation, 1,880 units were produced and 1,720 units were sold. Actual fixed costs are the same as the amount budgeted for the month and the per unit administration cost for production is provided below. Other information for the month includes:

Variable manufacturing costs $22.86 per unit

Variable marketing costs $4.19 per unit

Fixed manufacturing costs $13.34 per unit

Administrative expenses, all fixed $7.16 per unit

Ending inventories:

Direct materials -0-

WIP -0-

Finished goods 160 units

Required - What is the operating income of the business in the first month of operation using the absorption costing method?