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: Sales revenue (2,000 units) $60,000 Variable costs: Direct materials 6,000 Direct labor 8,000 Overhead 2,500 Fixed costs 6,000 Net operating income $37,500 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?
A) $44,025
B) $43,125
C) $37,500
D) $35,025
A
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