Assume the following information for the first year of operations for a company that sells only one product for a price of $48 per unit:**Variable cost per unit:**- Direct materials: $25**Fixed costs per year:**- Direct labor: $140,000- Fixed manufacturing overhead: $183,000- Fixed selling and administrative expenses: $70,000The company does not incur any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 20,000 units and sold 18,000 units. What is the net operating income using super-variable costing?

The supervariable costing assumes only direct materials to be the variable cost. Other costs…

Assume the following information for the first year of operations for a company that sells only one product for a price of $48 per unit: Variable cost per unit: Direct materials Fixed costs per year: Direct labor Fixed manufacturing overhead Fixed selling and administrative expenses $ 25 $ 140,000 $ 183,000 $ 70,000 The company does not incur any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 20,000 units and sold 18,000 units. What is the net operating income using super-variable costing?

Assume the following information for the first year of operations for a company that sells only one product for a price of $48 per unit: Variable cost per unit: Direct materials Fixed costs per year: Direct labor Fixed manufacturing overhead Fixed selling and administrative expenses $ 25 $ 140,000 $ 183,000 $ 70,000 The company does not incur any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 20,000 units and sold 18,000 units. What is the net operating income using super-variable costing?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Lynch Company manufactures and sells a single product. The following costs were incurred during the company's first year of operations: Variable costs per unit: Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative $ 10 $ 4 $ 2 $ 2 $ 374,000 $ 284,000 During the year, the company produced 34,000 units and sold 26,000 units. The selling price of the company's product is $44 per unit. Required: 1. Assume that the company uses absorption costing: a. Compute the unit product cost. b. Prepare an income statement for the year. 2. Assume that the company uses variable costing: a. Compute the unit product cost. b. Prepare an income statement for the year. Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 2A Req 2B Compute the unit product cost. Assume that the company uses absorption costing. Unit product cost
Domestic
Walsh Company manufactures and sells one product. The following information pertains to each of the company’s first two years of operations: Variable costs per unit: Manufacturing: Direct materials $ 20 Direct labor $ 12 Variable manufacturing overhead $ 4 Variable selling and administrative $ 3 Fixed costs per year: Fixed manufacturing overhead $ 320,000 Fixed selling and administrative expenses $ 80,000 During its first year of operations, Walsh produced 50,000 units and sold 40,000 units. During its second year of operations, it produced 40,000 units and sold 50,000 units. The selling price of the company’s product is $59 per unit. Required: 1. Assume the company uses variable costing: a. Compute the unit product cost for Year 1 and Year 2. b. Prepare an income statement for Year 1 and Year 2. 2. Assume the company uses absorption costing: a. Compute the unit product cost for Year 1 and Year 2. b. Prepare an income statement for Year 1 and Year 2.…
Walsh Company manufactures and sells one product. The following information pertains to the company's first two years of operations: variable cost per unit manufacturing direct materials $30 direct labor $12 variable manufacturing overhead $5 variable selling and administrative $4; fixed costs per year, fixed manufacturing overhead $240,00 fixed selling and administrative expenses $60,000. During its first years of operations, Walsh produced 50,000 units and sold 40, 000 units. During its second year of operations, it produced 40,000 units and sold 50,000 units. The selling price of the company's product is $51 per unit. Assume the company uses variable costing. Prepare an income statement for Year 1 and 2. Assume that the company uses absorption costing. Compute the unit product cost for year 1 and 2. Assume the company uses absorption costing. Prepare an income statement for Year 1 and 2. Reconcile the difference between variable costing and absorption costing net operating income in…
Bracey Company manufactures and sells one product. The following information pertains to the company's first year of operations: Variable cost per unit: Direct materials Fixed costs per year: Direct labor $ 32 $ 450,500 Fixed manufacturing overhead Fixed selling and administrative expenses $ 431,950 $ 74,000 The company does not incur any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, Bracey produced 26,500 units and sold 24,300 units. The selling price of the company's product is $72 per unit. Required: 1. Assume the company uses super-variable costing: a. Compute the unit product cost for the year. b. Prepare an income statement for the year. 2. Assume the company uses a variable costing system that assigns $17.00 of direct labor cost to each unit produced: a. Compute the unit product cost for the year. b. Prepare an income statement for the year. 3. Assume the company uses an absorption costing system that…
Need Answer please
Diego Company manufactures one product that is sold for $72 per unit. The following information pertains to the company’s first year of operations in which it produced 55,000 units and sold 50,000 units. Variable costs per unit: Manufacturing: Direct materials $ 23 Direct labour $ 14 Variable manufacturing overhead $ 3 Variable selling and administrative $ 5 Fixed costs per year: Fixed manufacturing overhead $ 770,000 Fixed selling and administrative expenses $ 607,000 9. What would have been the company’s variable costing net operating income (loss) if it had produced and sold 50,000 units?
Lynch Company manufactures and sells a single product. The following costs were incurred during the company's first year of operations: Variable costs per unit: Manufacturing: Direct materials Direct labor $ 10 $4 Variable manufacturing overhead $2 Variable selling and administrative $2 Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative $ 374,000 $ 284,000 During the year, the company produced 34,000 units and sold 26,000 units. The selling price of the company's product is $44 per unit. b. Prepare an income statement for the year.
Diego Company manufactures one product that is sold for $75 per unit in two geographic regions-the East and West regions. The following information pertains to the company's first year of operations in which it produced 46,000 units and sold 42,000 units. Variable costs per unit: Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expense E al gross margin Okay The company sold 31,000 units in the East region and 11,000 units in the West region. It determined that $200,000 of its fixed selling and administrative expense is traceable to the West region, $150,000 is traceable to the East region, and the remaining $38,000 is a common fixed expense. The company will continue to incur the total amount of its fixed manufacturing overhead costs as long as it continues to produce any amount of its only product. What is the company's total gross margin…
O’Brien Company manufactures and sells one product. The following information pertains to each of the company’s first three years of operations: Variable costs per unit: Manufacturing: Direct materials $ 26 Direct labor $ 15 Variable manufacturing overhead $ 5 Variable selling and administrative $ 2 Fixed costs per year: Fixed manufacturing overhead $ 570,000 Fixed selling and administrative expenses $ 140,000 During its first year of operations, O’Brien produced 96,000 units and sold 77,000 units. During its second year of operations, it produced 85,000 units and sold 99,000 units. In its third year, O’Brien produced 87,000 units and sold 82,000 units. The selling price of the company’s product is $79 per unit. 4. Assume the company uses absorption costing and a LIFO inventory flow assumption (LIFO means last-in first-out. In other words, it assumes that the newest units in inventory are sold first): Compute the unit product cost for Year 1, Year 2, and…
Andretti Company has a single product called a Dak. The company normally produces and sells 86,000 Daks each year at a selling price of $62 per unit. The company’s unit costs at this level of activity are given below: Direct materials $ 9.50 Direct labor 9.00 Variable manufacturing overhead 3.20 Fixed manufacturing overhead 5.00 ($430,000 total) Variable selling expenses 4.70 Fixed selling expenses 4.00 ($344,000 total) Total cost per unit $ 35.40 A number of questions relating to the production and sale of Daks follow. Each question is independent. Required: 1-a. Assume Andretti Company has sufficient capacity to produce 111,800 Daks each year without any increase in fixed manufacturing overhead costs. The company could increase its unit sales by 30% above the present 86,000 units each year if it increased fixed selling expenses by $130,000. What is the financial advantage (disadvantage) of investing an additional $130,000 in fixed selling expenses? 1-b.…
Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company's normal activity level of 84,000 units per year is: Direct materials Direct labor Variable manufacturing overhead. Fixed manufacturing overhead Variable selling and administrative expense Fixed selling and administrative expense $ 2.50 $ 2.00 $ 0.80 $ 4.45 $ 1.20 $ 1.00 The normal selling price is $23.00 per unit. The company's capacity is 109,200 units per year. An order has been received from a mail-order house for 2,100 units at a special price of $20.00 per unit. This order would not affect regular sales or the company's total fixed costs. Required: 1. What is the financial advantage (disadvantage) of accepting the special order? 2. As a separate matter from the special order, assume the company's inventory includes 1,000 units of this product that were produced last year and that are inferior to the current model. The units must be sold through regular channels…