4.. Peak Manufacturing produces snow blowers. The selling price per snow blower is $100. Costs involved in production are:

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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1.

 

4.. Peak Manufacturing produces
snow blowers. The selling price per
snow blower is $100. Costs involved
in production are:
Direct material per
unit
$20
Direct labor per
unit
12
Variable manufacturing overhead
per unit
10
Fixed manufacturing overhead per
year
$148,500
In addition, the company has fixed
selling and administrative costs of
$150,000 per year. During the year,
Peak produces 45,000 snow
blowers and sells 30,000 snow
blowers. Ignoring taxes, how much
will full costing profit differ from
variable costing profit?
Transcribed Image Text:4.. Peak Manufacturing produces snow blowers. The selling price per snow blower is $100. Costs involved in production are: Direct material per unit $20 Direct labor per unit 12 Variable manufacturing overhead per unit 10 Fixed manufacturing overhead per year $148,500 In addition, the company has fixed selling and administrative costs of $150,000 per year. During the year, Peak produces 45,000 snow blowers and sells 30,000 snow blowers. Ignoring taxes, how much will full costing profit differ from variable costing profit?
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