Rene Inc. has capacity to produce 15,000 units of inventory. It operated at 100% capacity during the second quarter of the current year and provided the following cost data:Cost DataProduction costs (15,000 units):Units$ per unitTotal $ Direct materials15,000$10$150,000 Direct labor15,00012$180,000 Variable factory overhead15,0008$120,000 Fixed factory overhead-3$45,000Total production costs--$495,000Operating expenses:--- Variable selling and administrative expenses13,0005$65,000 Fixed selling and administrative expenses--$40,000Total operating expenses--$105,000There was no inventory on hand at the beginning of the quarter. If 13,000 units are sold during the quarter at a price of $45 per unit, what would be the amount of gross profit to be reported in the absorption costing income statement?Group of answer choices$455,000$156,000$45,000$130,000

The objective of the question is to calculate the gross profit to be reported in the absorption…

Answered: Rene Inc. has capacity to produce…

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter7: Variable Costing For Management analysis

Section: Chapter Questions

Problem 5E: On April 30, the end of the first month of operations, Joplin Company prepared the following income...

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Question

Rene Inc. has capacity to produce 15,000 units of inventory. It operated at 100% capacity during the second quarter of the current year and provided the following cost data:

Cost Data

Production costs (15,000 units):	Units	$ per unit	Total $
Direct materials	15,000	$10	$150,000
Direct labor	15,000	12	$180,000
Variable factory overhead	15,000	8	$120,000
Fixed factory overhead	-	3	$45,000
Total production costs	-	-	$495,000
Operating expenses:	-	-	-
Variable selling and administrative expenses	13,000	5	$65,000
Fixed selling and administrative expenses	-	-	$40,000
Total operating expenses	-	-	$105,000

There was no inventory on hand at the beginning of the quarter. If 13,000 units are sold during the quarter at a price of $45 per unit, what would be the amount of gross profit to be reported in the absorption costing income statement?

Group of answer choices

$455,000

$156,000

$45,000

$130,000

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