Addison, Incorporated makes a single product, an indoor fireplace. Data for last year is as follows: Selling price per fireplace$420 Manufacturing costs: Variable per unit produced: Direct materials$135 Direct labor$43 Variable manufacturing overhead$37 Fixed manufacturing overhead per year$210,000 Selling and administrative expenses: Variable per unit sold$45 Fixed per year$190,000 Units in beginning inventory0 Units produced during the year5,000 Units sold during the year4,500 Required: Please solve for the absorption costing income statement and the number of fireplaces required to break-even

The gross margin is calculated as the difference between the sales and cost of goods sold. The…

Answered: Addison, Incorporated makes a single…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter2: Basic Cost Management Concepts

Section: Chapter Questions

Problem 22E: Ellerson Company provided the following information for the last calendar year: During the year,...

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Addison, Incorporated makes a single product, an indoor fireplace. Data for last year is as follows:

Selling price per fireplace	$420
Manufacturing costs:
Variable per unit produced:
Direct materials	$135
Direct labor	$43
Variable manufacturing overhead	$37
Fixed manufacturing overhead per year	$210,000
Selling and administrative expenses:
Variable per unit sold	$45
Fixed per year	$190,000

Units in beginning inventory	0
Units produced during the year	5,000
Units sold during the year	4,500

Required:
Please solve for the absorption costing income statement and the number of fireplaces required to break-even

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