3.7besdNo Sugar Corporation began its operations on January 1, 2007 and produces a singproduct that sells for P28 per unit. Standard capacity is 100,000 units per year. During the yem100,000 units were produced and 75,000 units were sold. Manufacturing costs and selling anadministrative expenses were as follows:Direct materialsDirect laborP3.00 per unit produced2.00 per unit producedP300,000 + 1.00 per producedSelling and administrative expenses P160,000 + 1.00 per unit sold00000Factory overheadInstructions:1. Determine the total cost of ending inventory under variable costing and absorpticosting2. Determine the total cost of sales under variable costing and absorption costing.3. Determine the net income under the variable costing and absorption costing.

Under variable costing, the product cost consists of only variable manufacturing costs. Under…

Answered: 3.7 No Sugar Corporation began its…

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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Diego Company manufactures one product that is sold for $75 per unit in two geographic regions-the East and West regions. The following information pertains to the company's first year of operations in which it produced 46,000 units and sold 42,000 units. 2 W Variable costs per unit: Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expense Profit will # S The company sold 31,000 units in the East region and 11,000 units in the West region. It determined that $200,000 of its fixed selling and administrative expense is traceable to the West region, $150,000 is traceable to the East region, and the remaining $38,000 is a common fixed expense. The company will continue to incur the total amount of its fixed manufacturing overhead costs as long as it continues to produce any amount of its only product. 15. Assume the West region invests $36,000…
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MAS 1 Company sells 10,000 units of its products to SM Supermarket. Its selling price is P 50 per unit. The details of its costs are as follows: Direct Materials P 6 per unit Direct Labor P 10 per unit Variable Factory Overhead P 4 per unit Fixed Factory Overhead P 150,000 Variable Expenses P 5 per unit Fixed Expenses P 50,000 Assume each questions as independent assumptions: 10. Contribution margin at P100,000 profit 11. Contribution margin at (P50,000) loss 12. Units sold when there is P100,000 profit 13. Units sold when there is (P50,000) loss 14. Fixed costs and expenses at P100,000 profit 15. Fixed costs and expenses at (P50,000) loss
Polaski Company manufactures and sells a single product called a Ret. Operating at capacity, the company can produce and sell 34,000 Rets per year. Costs associated with this level of production and sales are given below: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expense Fixed selling expense Total cost Unit $15 6 IN MING 3 1. 2. 3. 5 Financial advantage Financial (disadvantage) 2 6 $ 37 Total $ 510,000 204,000 The Rets normally sell for $42 each. Fixed manufacturing overhead is $170,000 per year within the range of 24,000 through 34,000 Rets per year. 102,000 170,000 68,000 204,000 $ 1,258,000 Required: 1. Assume that due to a recession, Polaski Company expects to sell only 24,000 Rets through regular channels next year. A large retail chain has offered to purchase 10,000 Rets if Polaski is willing to accept a 16% discount off the regular price. There would be no sales commissions on this order; thus, variable selling…
10 In July, TPM Co. incurred total costs of $60,000 and made 6000 units. In December it produced 4000 units and total costs were $40,000. What is the variable cost per unit? a. S12.00 b. $15.00 c. S10.00 d. $8.00
Algee Ltd plans to manufacture kettles and the following information is applicable: Estimated sales for the year 20.15 Estimated costs for the year 20.15 Direct material 14 000 units at R80 each R24 per unit Direct labour Factory overheads (all fixed) Selling expenses Administrative expenses (all fixed) R4 per unit R48 000 per annum 30% of sales R78 000 per annum 3.1 Calculate the break-even quantity 3.2 Calculate the break-even value using the marginal income ratio. 3.3 Calculate the selling price per unit if the profit per unit is R4. 3.4 Calculate the new break-even quantity and value if selling price is increased by 10%. 3.5 Calculate the selling price if 14 000 units provide an operating profit of RO after an additional advertising expense of R54 000
6
Diego Company manufactures one product that is sold for $72 per unit in two geographic regions-the East and West regions. The following information pertains to the company's first year of operations in which it produced 55,000 units and sold 50,000 units. Variable costs per unit: Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Profit will Fixed manufacturing overhead Fixed selling and administrative expense $ 23 $ 14 $3 $5 The company sold 37,000 units in the East region and 13,000 units in the West region. It determined that $290,000 of its fixed selling and administrative expense is traceable to the West region, $240,000 is traceable to the East region, and the remaining $77,000 is a common fixed expense. The company will continue to incur the total amount of its fixed manufacturing overhead costs as long as it continues to produce any amount of its only product. $ 770,000 $ 607,000 15. Assume the…
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Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company's normal activity level of 87,600 units per year is: Direct materials Direct labor Variable manufacturing overhead $ 2.20 $ 4.00 $ 0.70 $ 4.25 Variable selling and administrative expenses Fixed selling and administrative expenses $ 1.80 $ 3.00 Fixed manufacturing overhead 5 The normal selling price is $20.00 per unit. The company's capacity is 111,600 units per year. An order has been received from a mail-order house for 2,000 units at a special price of $17.00 per unit. This order would not affect regular sales or total fixed costs. Required: 1. What is the financial advantage (disadvantage) of accepting the special order? 2. As a separate matter from the special order, assume the company's inventory includes 1,000 units that are inferior quality. The units must be sold through regular channels at a reduced price. The company does not expect the selling of these…
Chapter 6: A Closer Look on Cost Accounting The company makes 2,350 units of product X a year, requiring a total os 3.300 machine hours, 250 orders and 200 inspection hours per year. The product's direct material cost is P201.50 and its direct labor cost in P211.11 per unit. The product sells for P590 per unit. According to the activity-based costing system, the gross margin for product X is? 423,087.50 b. 350,435.50 c. 416,890 d. None of the choice a. 56. The following information is available for Mary Corp. Activity Pool Setups Quality Inspections Assembly (direct labor hour) What is the activity rate for setups? Activity Base 50,000 120,000 400,000 Budgeted Amount 300,000 600,000 2,000,000 a. P5.09 c. РО.75 d. P58.00 b. Рб.00 The activity rate for quality inspection is: с. Рб.00 d. P5.09 a. P5.29 b. P5.00
A company selling a single product with the cost of producing and selling a single unit of this product at the company's normal activity level of 60000 units per year. Direct material $5.10 Direct labor $3.80 Variable management overhead $1.00 Fixed manufacturing overhead $4.70 Variable selling and administrative expenses $1.50 Fixed selling and administrative expense $2.40 Capacity per year 75000 units Normal selling price per unit $21.00 Question: an order was received as a mail-order house for 15000 units at $14.00 per unit. This order would not affect the company's regular sales or the companies total fixed cost. What is the financial advantage or disadvantage of accept this special order? Thank you,

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