Hard Managerial Accounting Question Need Help as soon as possible, will give high rating!

Question

Ruland and Company makes a single product. Each unit requires $55 of direct materials. Factory overhead is applied on 150% of direct labor cost. Two third of factory overhead is fixed. The company reports the following results for February :

 

Number of Units Sold : 8,000

Selling Price Per Unit : $300

Manufacturing Cost Per Unit : $130

Variable Selling Expenses Per Unit : $18

Total Fixed Selling Expenses : $54,700

Variable Admin Expenses Per Unit : $32

Total Fixed Admin Expenses : $242,700

 

The company has no beginning or ending inventory.

 

The operating income for the month is : 

 

A) 662,600 B) 960,000 C) 1,200,000 D) 1,242,000 E) None

 

Answer was A) but I need help with Steps as to how .

 

Thanks.

Answer 1

Sagnik,

 

Total fixed costs = 242700 + 54700

Variable costs = 18 + 32 + 130 = 180 per unit

 

8000 units were sold for $ 300 each

 

Net income = 8000 (300-180) - 242700 -54700

= $662600