Jarmon Company, which has only one product, has provided the following data concerning its most recent month of operations: The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month.
-What is the net operating income for the month under variable costing?
A) $4,500
B) $10,900
C) $25,500
D) $12,800

Question

Jarmon Company, which has only one product, has provided the following data concerning its most recent month of operations:  The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month.
-What is the net operating income for the month under variable costing?
A) $4,500 
B) $10,900 
C) $25,500 
D) $12,800

Quizplus · Accepted Answer

Variable costing only considers variable costs in the calculation of net operating income, excluding fixed manufacturing overhead. The correct net operating income under variable costing is $10,900.

Jarmon Company, Which Has Only One Product, Has Provided the Following