Llywelyn, Inc. reports the following information for July: Sales Revenue $ 1 comma 000 comma 000 Variable Costs 200 comma 000 Operating Income 380 comma 000 What is the total fixed cost using variable costing? A. $ 420 comma 000 B. $ 800 comma 000 C. $ 180 comma 000 D. $ 580 comma 000

Question

Business

Lilian

21 January, 23:15

Llywelyn, Inc. reports the following information for July: Sales Revenue $ 1 comma 000 comma 000 Variable Costs 200 comma 000 Operating Income 380 comma 000 What is the total fixed cost using variable costing? A. $ 420 comma 000 B. $ 800 comma 000 C. $ 180 comma 000 D. $ 580 comma 000

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Answers (1)

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Escobar · Answer 1

A. $ 420,000

Explanation:

We have to find the missing information

Sales revenues 1,000,000

variable cost (200,000)

Contribution Margin 800,000

Fixed Cost X

Operating Income 380,000

Contribution margin - operating income = fixed cost

$800,000 - $380,000 = fixed cost

fixed cost = $420,000