A manufacturer reports the following costs to produce 12,000 units in its first year of operations: ⚫ Direct materials: $12 per unit Direct labor: $8 per unit . Variable overhead: $84,000 Fixed overhead: $150,000 Of the 12,000 units produced, 10,500 were sold, and 1,500 remain in inventory at year-end. Under absorption costing, the value of the inventory is

A manufacturer reports the following costs to produce 12,000 units in its first year of operations: ⚫ Direct materials: $12 per unit Direct labor: $8 per unit . Variable overhead: $84,000 Fixed overhead: $150,000 Of the 12,000 units produced, 10,500 were sold, and 1,500 remain in inventory at year-end. Under absorption costing, the value of the inventory is

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter7: Variable Costing For Management analysis

Section: Chapter Questions

Problem 1E: At the end of the first year of operations, 21,500 units remained in the finished goods inventory....

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Ellerson Company provided the following information for the last calendar year: During the year, direct materials purchases amounted to 278,000, direct labor cost was 189,000, and overhead cost was 523,000. During the year, 100,000 units were completed. Refer to Exercise 2.21. Last calendar year, Ellerson recognized revenue of 1,312,000 and had selling and administrative expenses of 204,600. Required: 1. What is the cost of goods sold for last year? 2. Prepare an income statement for Ellerson for last year.
Ellerson Company provided the following information for the last calendar year: During the year, direct materials purchases amounted to 278,000, direct labor cost was 189,000, and overhead cost was 523,000. During the year, 100,000 units were completed. Required: 1. Calculate the total cost of direct materials used in production. 2. Calculate the cost of goods manufactured. Calculate the unit manufacturing cost. 3. Of the unit manufacturing cost calculated in Requirement 2, 2.70 is direct materials and 5.30 is overhead. What is the prime cost per unit? Conversion cost per unit?
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