"acation Corporation produces a single product. Data concernin, he company's first year of operations appear below: Units produced 10,000 Units sold 9,000 Selling price per unit P60 DM P15 DL P5 Variable OH P2 Variable selling and administrative P4 Fixed OH P200,000 Fixed selling and administrative P70,000 Compute for the difference in net operating income metween absorption costing and variable costing for the

"acation Corporation produces a single product. Data concernin, he company's first year of operations appear below: Units produced 10,000 Units sold 9,000 Selling price per unit P60 DM P15 DL P5 Variable OH P2 Variable selling and administrative P4 Fixed OH P200,000 Fixed selling and administrative P70,000 Compute for the difference in net operating income metween absorption costing and variable costing for the

Name: Vacation Corporation produces a single product. Data concerningthe co
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Description: Vacation Corporation produces a single product. Data concerningthe company's first year of operations appear below:Units produced10,000Units sold9,000Selling price per unitР60DMP15DLP5Variable OHP2Variable selling and administrativeP4Fixed OHP200,00

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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Assume the following information for a company that produced 10,000 units and sold 9,000 units during its first year of operations: Selling price Direct materials Direct labor Variable manufacturing overhead Sales commission Fixed manufacturing overhead Per Unit $ 200 $ 72 $ 50 $ 10 $8 Multiple Choice $ 287,000 Which of the following choices explains the relationship between the absorption costing net operating income and the variable costing net operating income? The absorption costing net operating income will be lower than the variable costing net operating income by $28,700. The absorption costing net operating income will be lower than the variable costing net operating income by $100,700. Per Year The absorption costing net operating income will be higher than the variable costing net operating income by $28,700.
Domestic
ed Dowell Company produces a single product. Its income statements under absorption costing for its first two years of operation follow. Income Statements (Absorption Costing) Sales ($60 per unit) Year 1 $ Year 2 $ 1,920,000 3,960,000 Cost of goods sold ($45 per unit) 1,440,000 2,970,000 Gross profit 480,000 990,000 Selling and administrative expenses ok Income t 338,000 474,000 $ 142,000 $ 516,000 Additional Information a. Sales and production data for these first two years follow. Year 1 Year 2 nces Units Units produced 49,000 49,000 Units sold 32,000 66,000 b. Variable costs per unit and fixed costs per year are unchanged during these years. The company's $45 per unit product cost using absorption costing consists of the following. Direct materials Direct labor $ 12 19 Variable overhead Fixed overhead ($539,000/49,000 units) 3 11 Total product cost per unit $ 45 c. Selling and administrative expenses consist of the following. Selling and Administrative Expenses Variable selling and…
Jenna Corporation sells a single product. Management has provided the following data for two levels of monthly sales volume. The company sells the product for $172.50 per unit. Sales Volume in Units 4,000 5,000 Cost of Sales (COS) $307,600 $384,500 Selling, General & Administrative Costs (SG&A) $321,200 $337,000 Selling Price Per Unit $173 Total costs for these cost categories and may include both Fixed and Variable costs. HINT: See high-low analysis. 1. Calculate the total contribution margin when 4,300 units are sold. 2. What is the breakeven point in Sales dollars if Advertising (a fixed SG&A cost) is increased by $40,000? Please show calculations.
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The following information pertains to the first year of operation for Crystal Cold Coolers Inc.: Number of units produced Number of units sold Unit sales price Direct materials per unit Direct labor per unit Variable manufacturing overhead per unit Fixed manufacturing overhead per unit ($224,000/2,800 units) Total variable selling expenses ($11 per unit sold) Total fixed general and administrative expenses Complete this question by entering your answers in the tabs below. Full Absorption Costing LA LA LA LA LA Variable Costing $ $ $ Required: Prepare Crystal Cold's full absorption costing income statement and variable costing income statement for the year. 2,800 2,400 340 60 45 13 80 $ 26,400 $ 60,000
Dowell Company produces a single product. Its income statements under absorption costing for its first two years of operation follow. Income Statements (Absorption Costing) Sales ($52 per unit) Cost of goods sold ($36 per unit) Year 2 Year 1 $ 1,508,000 1,044,000 $ 2,756,000 1,908,000 Gross profit Selling and administrative expenses Income Additional Information a. Sales and production data for these first two years follow. Units Units produced Units sold Year 1 41,000 29,000 Year 2 41,000 53,000 464,000 366,000 848,000 462,000 $ 98,000 $ 386,000 b. Variable costs per unit and fixed costs per year are unchanged during these years. The company's $36 per unit product cost using absorption costing consists of the following. Direct materials Direct labor Variable overhead Fixed overhead ($451,000/41,000 units) Total product cost per unit $ 11 11 3 11 $ 36 c. Selling and administrative expenses consist of the following. Selling and Administrative Expenses Variable selling and administrative…
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