c) Without preparing an income statement, determine the absorption costing net operatingincome for the month. (Hint: Use the reconciliation method)d) Explain how fixed manufacturing overhead cost is shifted from one period to anotherusing absorption costing system. Q1. Zingling Inc produces only product and following information relates to the recent month ofoperation:Selling price|Units in inventoryUnits producedUnits soldUnits in inventory$121000 units4300 units4000 units300 unitsVariable cost per unit:Direct Materials| Direct LaborVariable manufacturing overheadVariable selling and administrative$44$35$7$5Fixed costs:Fixed manufacturing overheadFixed selling and administrative$34400$72000

The income statement is prepared find the net income or loss incurred during the period.

Answered: c) Without preparing an income…

FINANCIAL ACCOUNTING

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Author:Libby

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Chapter1: Financial Statements And Business Decisions

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Question: In cost accounting, what is the primary purpose of calculating the predetermined overhead rate? A) To allocate indirect costs to products based on a predetermined formula.B) To determine the actual overhead costs incurred during a specific production period.C) To calculate variable costs associated with each unit of production.D) To assess fixed costs that remain constant regardless of production levels.
Use the information to prepare a schedule of cost of goods manufactured and an income statement. Assume no indirect materials are used and all amounts are shown in millions.
Hi-Tek Manufacturing, Incorporated, makes two industrial component parts-B300 and T500. An absorption costing income statement for the most recent period is shown below: Hi-Tek Manufacturing, Incorporated Income Statement Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating loss Hi-Tek produced and sold 60,400 units of B300 at a price of $21 per unit and 12,800 units of T500 at a price of $39 per unit. The company's traditional cost system allocates manufacturing overhead to products using a plantwide overhead rate and direct labor dollars as the allocation base. Additional information relating to the company's two product lines is shown below: Direct materials Direct labor Manufacturing overhead Cost of goods sold $ 1,767,600 1,212,922 554,678 610,000 $ (55,322) 8300 T500 $ 400,300 $ 162,400 $ 120,100. $ 42,400 Activity Cost Pool (and Activity Measure) Machining (machine-hours) Setups (setup hours) Product-sustaining (number of products) Other…
Great Outdoze Company manufactures sleeping bags, which sell for $66.10 each. The variable costs of production are as follows: Direct material Direct labor Variable manufacturing overhead $19.10 10.30 7.40 k Budgeted fixed overhead in 20x1 was $157,500 and budgeted production was 25,000 sleeping bags. The year's actual production was 25,000 units, of which 21,300 were sold. Variable selling and administrative costs were $1.30 per unit sold; fixed selling and administrative costs were $22,000. at
The Dorilane Company produces a set of wood patio furniture consisting of a table and four chairs. The company has enough customer demand to justify producing its full capacity of 3,800 sets per year. Annual cost data at full capacity follow: Direct labor Advertising Factory supervision Property taxes, factory building Sales commissions Insurance, factory Depreciation, administrative office equipment Lease cost, factory equipment Indirect materials, factory Depreciation, factory building Administrative office supplies (billing) Administrative office salaries Direct materials used (wood, bolts, etc.) Utilities, factory $ 89,000 $ 103,000 $70,000 $ 23,000 $ 65,000 $ 6,000 $ 2,000 $ 17,000 $ 18,000 $ 106,000 $ 5,000 $ 111,000 $ 426,000 $ 46,000 Required: 1. Enter the dollar amount of each cost item under the appropriate headings. Note that each cost item is classified in two ways: first, as variable or fixed with respect to the number of units produced and sold; and second, as a selling…
Which method of determining operating income is used internally for decision making and considers fixed factory overhead a period expense?

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c) Without preparing an income statement, determine the absorption costing net operating income for the month. (Hint: Use the reconciliation method) d) Explain how fixed manufacturing overhead cost is shifted from one period to another using absorption costing system.