Exam 19: Variable Costing and Analysis

What is Red and White's net income under variable costing if 980 units are sold and operating expenses are $12,000?

During its first year of operations,the McCormick Company incurred the following manufacturing costs: Direct materials,$5 per unit,Direct labor,$3 per unit,Variable overhead,$4 per unit,and Fixed overhead,$250,000.The company produced 25,000 units,and sold 20,000 units,leaving 5,000 units in inventory at year-end.What is the value of ending inventory under absorption costing?