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Bowshar Hills Company sells shoes and expects to produce and sell 30,000 units during the year 2022 with no beginning or ending inventories as it plans to produce what it can sell during the same year. The total budgeted fixed manufacturing overhead cost for the year is $50,000. The company accounts show that the budgeted direct material cost is $4 per unit, budgeted direct labor cost is $6 per direct labor hour, and budgeted variable manufacturing overhead is $2 per direct labor hour. Each unit produced takes 2 hours of skilled labor time. The cost of goods sold reported in the budgeted income statement for 2022 is: O a. $1,050,000 O b. $650,000 Oc $850,000 O d. $450,000 O e. None of the given answers

Bowshar Hills Company sells shoes and expects to produce and sell 30,000 units during the year 2022 with no beginning or ending inventories as it plans to produce what it can sell during the same year. The total budgeted fixed manufacturing overhead cost for the year is $50,000. The company accounts show that the budgeted direct material cost is $4 per unit, budgeted direct labor cost is $6 per direct labor hour, and budgeted variable manufacturing overhead is $2 per direct labor hour. Each unit produced takes 2 hours of skilled labor time. The cost of goods sold reported in the budgeted income statement for 2022 is: O a. $1,050,000 O b. $650,000 Oc $850,000 O d. $450,000 O e. None of the given answers

FINANCIAL ACCOUNTING
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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Bowshar Hills Company sells shoes and expects to produce and sell 30,000 units during the year 2022 with no beginning or ending inventories as it plans to produce what it can sell during the same year. The total budgeted fixed manufacturing overhead cost for the year is $50,000. The company accounts show that the budgeted direct material cost is $4 per unit, budgeted direct labor cost is $6 per direct labor hour, and budgeted variable manufacturing overhead is $2 per direct labor hour. Each unit produced takes 2 hours of skilled labor time. The cost of goods sold reported in the budgeted income statement for 2022 is: O a. $1,050,000 O b. $650,000 Oc $850,000 O d. $450,000 O e. None of the given answers Company XYZ is currently producing and selling 20,000 units. The selling price per unit is $6 while the variable cost ratio is 20%. Assuming total fixed costs of $30,000, what is the margin of safety in ($) value? O a. 122,500 Fi of O b. 82,500 Oc. 102,500 O d. 142,500 O e. None of the given answers VIOUS PAGE NEXT PAGE
Transcribed Image Text:Bowshar Hills Company sells shoes and expects to produce and sell 30,000 units during the year 2022 with no beginning or ending inventories as it plans to produce what it can sell during the same year. The total budgeted fixed manufacturing overhead cost for the year is $50,000. The company accounts show that the budgeted direct material cost is $4 per unit, budgeted direct labor cost is $6 per direct labor hour, and budgeted variable manufacturing overhead is $2 per direct labor hour. Each unit produced takes 2 hours of skilled labor time. The cost of goods sold reported in the budgeted income statement for 2022 is: O a. $1,050,000 O b. $650,000 Oc $850,000 O d. $450,000 O e. None of the given answers Company XYZ is currently producing and selling 20,000 units. The selling price per unit is $6 while the variable cost ratio is 20%. Assuming total fixed costs of $30,000, what is the margin of safety in ($) value? O a. 122,500 Fi of O b. 82,500 Oc. 102,500 O d. 142,500 O e. None of the given answers VIOUS PAGE NEXT PAGE
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