ABC Pillow produces and sells animal pillow for $80.00 per unit. In the first month of operation, 3,000 units were produced and 2,250 units were sold. Actual fixed costs are the same as the amount budgeted for the month. Other information for the month includes: Variable manufacturing costs Variable marketing costs Fixed manufacturing costs Administrative expenses, all fixed Ending inventories: Direct materials $38 per unit $ 2 per unit $60,000 per month $12,000 per month -0- -0- WIP Finished goods 750 units 11) What is gross margin when using absorption costing? A) $95,000 B) $109,500 C) $154,500 D) $49,500

ABC Pillow produces and sells animal pillow for $80.00 per unit. In the first month of operation, 3,000 units were produced and 2,250 units were sold. Actual fixed costs are the same as the amount budgeted for the month. Other information for the month includes: Variable manufacturing costs Variable marketing costs Fixed manufacturing costs Administrative expenses, all fixed Ending inventories: Direct materials $38 per unit $ 2 per unit $60,000 per month $12,000 per month -0- -0- WIP Finished goods 750 units 11) What is gross margin when using absorption costing? A) $95,000 B) $109,500 C) $154,500 D) $49,500

Name: ABC Pillow produces and sells animal pillow for $80.00 per unit. In t
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Description: ABC Pillow produces and sells animal pillow for $80.00 per unit. In the first month ofoperation, 3,000 units were produced and 2,250 units were sold. Actual fixed costs are thesame as the amount budgeted for the month. Other information for the mont

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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Yammy Company currently produces ultimate discs in an automated process. Expected production per month is 80,000 units. The required direct materials costs $0.20 per unit and labor costs $0.10 per unit. Manufacturing fixed overhead costs are $5,000 per month. Manufacturing overhead is allocated based on units of production. What is the flexible budget total product costs for 80,000 and 40,000 units, respectively?
MCO Leather manufactures leather purses. Each purse requires 2 pounds of direct materials at a cost of $3 per pound and 0.7 direct labor hour at a rate of $17 per hour. Variable overhead is budgeted at a rate of $3 per direct labor hour. Budgeted fixed overhead is $14,000 per month. The company’s policy is to end each month with direct materials inventory equal to 30% of the next month’s direct materials requirement. At the end of August the company had 2,880 pounds of direct materials in inventory. The company’s production budget reports the following. Production Budget September October November Units to produce 4,800 6,800 6,400 (1) Prepare direct materials budgets for September and October.(2) Prepare direct labor budgets for September and October.(3) Prepare factory overhead budgets for September and October.
A company has the following budgeted and actual cost data for manufacturing 2,000 Product X units: Direct materials $50 per unit Direct labor $40 per unit Variable manufacturing overhead $ 5 $40,000 per year per unit Fixed manufacturing Overhead Product X sells for $200 per unit. Assume no beginning or ending inventories. The Gross Profit for selling 15 Product X units is %24
Palladium Inc. produces a variety of household cleaning products. Palladium's controller has developed standard costs for the following four overhead items: Overhead Item Total Fixed Cost Variable Rate per Direct Labor Hour Maintenance Power Indirect labor Rent $86,000 140,000 $0.20 0.45 2.10 35,000 Next year, Palladium expects production to require 88,000 direct labor hours Exercise 9-63 Flexible Budget for Various Levels of Activity Refer to the information for Palladium Inc. above. Required: 1. Prepare an overhead budget for the expected level of direct labor hours for the coming year. 2. Prepare an overhead budget that reflects production that is 15% higher than expected and for production that is 15% lower than expected.
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Paula Corporation reports the following for this month: The beginning inventory is 30 units. It produces 140 units during this month. And 150 units are sold at $3,000 each. The budgeted level of production used to calculate the budgeted fixed manufacturing cost per unit is 200 units, the same every month. Variable costs: manufacturing cost per unit = $100; the operating cost per unit = $20 Total Fixed costs: budgeted manufacturing costs = $7,000; operating costs = $36,000 How much is the unit product cost if the company uses absorption costing? $100 $120 $150 $335 $315 $135
Mcniff Corporation makes a range of products. The company's predetermined overhead rate is $17 per direct labor-hour, which was calculated using the following budgeted data: Variable manufacturing overhead $ 80,000 Fixed manufacturing overhead $ 260,000 Direct labor-hours 20,000 Management is considering a special order for 710 units of product O96S at $65 each. The normal selling price of product O96S is $76 and the unit product cost is determined as follows: Direct materials $ 38.00 Direct labor 17.00 Manufacturing overhead applied 17.00 Unit product cost $ 72.00 If the special order were accepted, normal sales of this and other products would not be affected. The company has ample excess capacity to produce the additional units. Assume that direct labor is a variable cost, variable manufacturing overhead is really driven by direct labor-hours, and total fixed manufacturing overhead would not be affected by the special…
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