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Hello students, here is a question.
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Company ir currently uses a variable costing in presenting its income statement.
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In march 2020, the company produces 50 ,000 units and sold 45 ,000 units.
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The company sells the product of 100 per unit.
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The following are the costs incurred during the march.
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Direct material is 30 per unit.
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Direct labor is 20 per unit.
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Manufacturing overhead is per unit and 30 % of fixed cost.
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Total period cost will be 20 ,000.
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30 % of fixed cost.
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Assume there is no ending inventory in february 2020.
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What would be the net operating income of a company? so, we have four options given here.
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We have to choose the right option.
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Let us start solving this.
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So, operating profit which includes the cost of debt, taxes and certain time changes.
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It is an amount of revenue remains the company after all expenses has been paid.
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So, we'll prepare net operating income of a company.
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So, the format will be particulars amount.
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Our first item is sales.
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So, sales has 45 ,000 into 100 which gives us 4 ,500 ,000 dollars and variable expenses.
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So, variable expenses will be variable cost of goods sold.
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So, that will be 45 ,000 into 64 which gives us 2 ,880 ,000 dollars and variable selling and administrative expenses...