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A Product Has a Sales Price of $20

Question 164

Essay

A product has a sales price of $20. Based on a 15,000-unit production level, the variable costs are
$12 per unit and the fixed costs are $6 per unit. Using a flexible budget for an actual production and sales level of 18,000 units, what is the budgeted operating income?

Correct Answer:

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Fixed costs = $6 * 15,000 units = $90,00...

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