Questions -
1-Ofarrell Corporation, a company that produces and sells a single product, has provided its contribution format income statement for March.
Sales (6,600 units)$429,000
Variable expenses297,000
Contribution margin132,000
Fixed expenses103,500
Net operating income$28,500
If the company sells 6,500 units, its net operating income should be closest to:
$26,500
$24,000
$28,500
$27,979
2- The following cost data pertain to the operations of Rademaker Department Stores, Inc., for the month of March.
Corporate headquarters building lease$80,100
Cosmetics Department sales commissions--Northridge Store$5,680
Corporate legal office salaries$61,900
Store manager's salary-Northridge Store$19,200
Heating-Northridge Store$13,100
Cosmetics Department cost of sales--Northridge Store$38,700
Central warehouse lease cost$8,600
Store security-Northridge Store$21,100
Cosmetics Department manager's salary--Northridge Store$4,460
The Northridge Store is just one of many stores owned and operated by the company. The Cosmetics Department is one of many departments at the Northridge Store. The central warehouse serves all of the company's stores.
What is the total amount of the costs listed above that are direct costs of the Cosmetics Department?
$44,380
$48,840
$96,100
$38,700