Question
In: Accounting
During its first year of operations, Silverman Company paid $12,625 for direct materials and $10,000 for...
During its first year of operations, Silverman Company paid
$12,625 for direct materials and $10,000 for production workers'
wages. Lease payments and utilities on the production facilities
amounted to $9,000 while general, selling, and administrative
expenses totaled $4,500. The company produced 5,750 units and sold
3,500 units at a price of $8.00 a unit.
What was Silverman's net income for the first year in operation?
Solutions
Expert Solution
|
Income Statement |
||
|
Sales [3,500 x $8.00] |
28,000 |
|
|
Less: Variable Costs |
||
|
Direct Materials [($12,625/5,750) x 3,500] |
7,685 |
|
|
Production workers' wages [($10,000/5,750) x 3,500] |
6,087 |
|
|
Lease payments and utilities on the production facilities [($9,000/5,750) x 3,500] |
5,478 |
19,250 |
|
Less: Fixed Costs |
||
|
General, selling, and administrative expenses |
4,500 |
|
|
Net Income |
4,250 |
The Silverman's net income for the first year in operation will be $4,250
ekkarill92 answered 1 year agoRelated Solutions
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