Question

Solow Company was just awarded a patent on a highly-specialized device. The engineer has set a...

Solow Company was just awarded a patent on a highly-specialized device. The engineer has set a strict production guideline. After making a mind-range plan for the company, the company expects the following for the next 2 years

Selling price per unit:$130

Variable costs per unit:

Direct materials:$10

Direct Labor: $30

Variable overhead:$6

Fixed factory overhead cost per year: ?

Selling and administrative expense per year (all fixed): $14600

Year 1 2

Production(units) 2000 2000

Sales(Units) 1500 2500

Income(Absortion Costing) $45100 $84900

what is the fixed factory overhead cost per year?

a. $206000

b. $66300

c. $88400

d. $103000

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