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2. Pacht Company, which has only one product, has provided the following data concerning its most recent month of operations: Selling price.. Units in beginning inventory Units produced. Units sold. Units in ending inventory. Variable costs per unit: Direct materials. Direct labor. Variable manufacturing overhead. Variable selling and administrative... Fixed costs: Fixed manufacturing overhead Fixed selling and administrative. ...….... $121 400 6,800 6,900 300 $35 $36 $3 $4 $197,200 $96,600 The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. Required: a. What is the unit product cost for the month under variable costing? b. Prepare an income statement for the month using the contribution format and the variable costing method. c. Without preparing an income statement, determine the absorption costing net operating income for the month. (Hint: Use the reconciliation method.)

2. Pacht Company, which has only one product, has provided the following data concerning its most recent month of operations: Selling price.. Units in beginning inventory Units produced. Units sold. Units in ending inventory. Variable costs per unit: Direct materials. Direct labor. Variable manufacturing overhead. Variable selling and administrative... Fixed costs: Fixed manufacturing overhead Fixed selling and administrative. ...….... $121 400 6,800 6,900 300 $35 $36 $3 $4 $197,200 $96,600 The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. Required: a. What is the unit product cost for the month under variable costing? b. Prepare an income statement for the month using the contribution format and the variable costing method. c. Without preparing an income statement, determine the absorption costing net operating income for the month. (Hint: Use the reconciliation method.)

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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2. Pacht Company, which has only one product, has provided the following data concerning its most recent month of operations: Selling price. Units in beginning inventory Units produced.. Units sold...... Units in ending inventory. Variable costs per unit: Direct materials. Direct labor. Variable manufacturing overhead. Variable selling and administrative....... Fixed costs: Fixed manufacturing overhead Fixed selling and administrative. $121 400 6,800 6,900 300 $35 $36 $3 $4 $197,200 $96,600 The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. Required: a. What is the unit product cost for the month under variable costing? b. Prepare an income statement for the month using the contribution format and the variable costing method. c. Without preparing an income statement, determine the absorption costing net operating income for the month. (Hint: Use the reconciliation method.)
Transcribed Image Text:2. Pacht Company, which has only one product, has provided the following data concerning its most recent month of operations: Selling price. Units in beginning inventory Units produced.. Units sold...... Units in ending inventory. Variable costs per unit: Direct materials. Direct labor. Variable manufacturing overhead. Variable selling and administrative....... Fixed costs: Fixed manufacturing overhead Fixed selling and administrative. $121 400 6,800 6,900 300 $35 $36 $3 $4 $197,200 $96,600 The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. Required: a. What is the unit product cost for the month under variable costing? b. Prepare an income statement for the month using the contribution format and the variable costing method. c. Without preparing an income statement, determine the absorption costing net operating income for the month. (Hint: Use the reconciliation method.)
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