Question - Hathaway Inc. produces and sells golf umbrellas to local resorts. Hathaway anticipates April to be a busy month with the sale of 2,000 umbrellas. The company has prepared the following static budget for April: During April, Hathaway actually produced and sold 2,300 umbrellas. What should be Hathaway's net operating income in April based on a flexible budget?
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Sales revenue (2,000 units)
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$60,000
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Variable costs:
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Direct materials
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6,000
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Direct labor
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8,000
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Overhead
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2,500
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Fixed costs
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6,000
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Net operating income
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$37,500
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