A company reports the following information for its first year of operations: If the company's cost per unit of finished goods using variable costing is $2,375, what is total variable overhead?
A) $237,500
B) $75,000
C) $312,500
D) $406,250
E) $97,500

Question

A company reports the following information for its first year of operations:  If the company's cost per unit of finished goods using variable costing is $2,375, what is total variable overhead?
A) $237,500 
B) $75,000 
C) $312,500 
D) $406,250 
E) $97,500

Quizplus · Accepted Answer

$2,375 = DM + DL + VOH
$2,375 = $750 + $1,000 + VOH
VOH = $625 per unit
$625 per unit × 650 units = $406,250

A Company Reports the Following Information for Its First Year