Absorption Costing, Value of Ending Inventory, Operating Income Pattison Products, Inc., began operations in October and manufactured 40,000 units during the month with the following unit costs: Direct materials $7.00 Direct labor 5.00 Variable overhead 2.50 Fixed overhead* 9.00 Variable marketing cost 2.20 * Fixed overhead per unit = $360,000 / 40,000 units produced = $9 Total fixed factory overhead is $360,000 per month. During October, 38,100 units were sold at a price of $29.50, and fixed marketing and administrative expenses were $130,800. Required: 1. Calculate the cost of each unit using absorption costing. Round your final answer to the nearest cent. $fill in the blank 998c14fccf9efc0_1 per unit 2. How many units remain in ending inventory? fill in the blank 998c14fccf9efc0_2 units What is the cost of ending inventory using absorption costing? $fill in the blank 998c14fccf9efc0_3 3. Prepare an absorption-costing income statement for Pattison Products, Inc., for the month of October. Pattison Products, Inc. Absorption-Costing Income Statement For the Month of October $fill in the blank 5d66d4fac04702d_2 fill in the blank 5d66d4fac04702d_4 Gross profit $fill in the blank 5d66d4fac04702d_5 Less: fill in the blank 5d66d4fac04702d_7 fill in the blank 5d66d4fac04702d_9 Operating income $fill in the blank 5d66d4fac04702d_10
Absorption Costing, Value of Ending Inventory, Operating Income
Pattison Products, Inc., began operations in October and manufactured 40,000 units during the month with the following unit costs:
| Direct materials | $7.00 |
| Direct labor | 5.00 |
| Variable |
2.50 |
| Fixed overhead* | 9.00 |
| Variable marketing cost | 2.20 |
* Fixed overhead per unit = $360,000 / 40,000 units produced = $9
Total fixed factory overhead is $360,000 per month. During October, 38,100 units were sold at a price of $29.50, and fixed marketing and administrative expenses were $130,800.
Required:
1. Calculate the cost of each unit using absorption costing. Round your final answer to the nearest cent.
$fill in the blank 998c14fccf9efc0_1 per unit
2. How many units remain in ending inventory?
fill in the blank 998c14fccf9efc0_2 units
What is the cost of ending inventory using absorption costing?
$fill in the blank 998c14fccf9efc0_3
3. Prepare an absorption-costing income statement for Pattison Products, Inc., for the month of October.
| Pattison Products, Inc. | |
| Absorption-Costing Income Statement | |
| For the Month of October | |
| $fill in the blank 5d66d4fac04702d_2 | |
| fill in the blank 5d66d4fac04702d_4 | |
| Gross profit | $fill in the blank 5d66d4fac04702d_5 |
| Less: | |
| fill in the blank 5d66d4fac04702d_7 | |
| fill in the blank 5d66d4fac04702d_9 | |
| Operating income | $fill in the blank 5d66d4fac04702d_10 |
4. What if November production was 40,000 units, costs were stable, and sales were 41,000 units? What is the cost of ending inventory?
$fill in the blank 7c0fbdfa9032f9d_1
What is operating income for November?
Dear student, as per Bartleby answering guidelines we can answer only three sub-parts if a question contains more than three sub-parts. For obtaining the answer to the remaining sub-parts please re-post the question with the remaining sub-parts.
As per absorption costing, the unit cost does not include marketing cost. The closing inventory is the difference between units produced and units sold during the month.
Income statement as per abortion cost consider the marketing cost as well whether it is fixed or not.
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