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ct materials et labor $ 20 $ 12 $ 4 $ 2 able manufacturing overhead le selling and administrative sts per year: manufacturing overhead selling and administrative expenses rst year of operations, Haas produced 60,000 units and sold 60,000 units $ 960,000 $ 240,000

ct materials et labor $ 20 $ 12 $ 4 $ 2 able manufacturing overhead le selling and administrative sts per year: manufacturing overhead selling and administrative expenses rst year of operations, Haas produced 60,000 units and sold 60,000 units $ 960,000 $ 240,000

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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Haas 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 Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses During its first year of operations, Haas produced 60,000 units and sold 60,000 units. During its second year of operations, it produced 75,000 units and sold 50,000 units. In its third year, Haas produced 40,000 units and sold 65,000 units. The selling price of the company's product is $58 per unit. Required: 1. Compute the company's break-even point in unit sales. 2. Assume the company uses variable costing: a. Compute the unit product cost for Year 1, Year 2, and Year 3. b. Prepare an income statement for Year 1, Year 2, and Year 3. 3. Assume the company uses absorption costing: a. Compute the unit product cost for Year 1, Year 2, and Year 3. b. Prepare an income statement for Year 1, Year 2, and Year 3. Req 1 Complete this question by entering your answers in the tabs below. Req 2A Req 2B Break-even unit sales Compute the company's break-even point in unit sales. $ 960,000 $ 240,000 Req 3A units $ 20 $ 12 $ 4 $ 2 < Req 1 Req 3B Req 2A >
Transcribed Image Text:Haas 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 Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses During its first year of operations, Haas produced 60,000 units and sold 60,000 units. During its second year of operations, it produced 75,000 units and sold 50,000 units. In its third year, Haas produced 40,000 units and sold 65,000 units. The selling price of the company's product is $58 per unit. Required: 1. Compute the company's break-even point in unit sales. 2. Assume the company uses variable costing: a. Compute the unit product cost for Year 1, Year 2, and Year 3. b. Prepare an income statement for Year 1, Year 2, and Year 3. 3. Assume the company uses absorption costing: a. Compute the unit product cost for Year 1, Year 2, and Year 3. b. Prepare an income statement for Year 1, Year 2, and Year 3. Req 1 Complete this question by entering your answers in the tabs below. Req 2A Req 2B Break-even unit sales Compute the company's break-even point in unit sales. $ 960,000 $ 240,000 Req 3A units $ 20 $ 12 $ 4 $ 2 < Req 1 Req 3B Req 2A >
Complete this question by entering your answers in the tabs below. Req 1 Unit product cost Req 1 Compute the unit product cost for Year 1, Year 2, and Year 3. Assume the company uses variable costing. Year 1 Req 2A Req 1 Net operating income (loss) Req 2A Unit product cost Req 1 Req 2A Req 2B Req 2B Req 2A Req 2B Prepare an income statement for Year 1, Year 2, and Year 3. Assume the company uses variable costing. Haas Company Variable Costing Income Statement Year 1 Year 2 Year 1 Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating income (loss) Req 3A Req 2B Year 3 < Req 1 $ $ Req 3A Req 3A < Req 2A 0 0 < Req 2B 0 0 $ Req 3A 0 Req 3B Haas Company Absorption Costing Income Statement Year 1 Req 3B Compute the unit product cost for Year 1, Year 2, and Year 3. Assume the company uses absorption costing. (Round your intermediate calculations and final answers to 2 decimal places.) Year 2 Year 3 0 $ Year 2 < Req 3A Req 3B 0 0 0 0 Req 3B Year 2 0 Req 2B > Prepare an income statement for Year 1, Year 2, and Year 3. Assume the company uses absorption costing. (Round your intermediate calculations to 2 decimal places.) $ Year 3 0 $ Req 3B > 0 0 Req 3A > 0 0 Year 3 0 0 Req 3B >
Transcribed Image Text:Complete this question by entering your answers in the tabs below. Req 1 Unit product cost Req 1 Compute the unit product cost for Year 1, Year 2, and Year 3. Assume the company uses variable costing. Year 1 Req 2A Req 1 Net operating income (loss) Req 2A Unit product cost Req 1 Req 2A Req 2B Req 2B Req 2A Req 2B Prepare an income statement for Year 1, Year 2, and Year 3. Assume the company uses variable costing. Haas Company Variable Costing Income Statement Year 1 Year 2 Year 1 Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating income (loss) Req 3A Req 2B Year 3 < Req 1 $ $ Req 3A Req 3A < Req 2A 0 0 < Req 2B 0 0 $ Req 3A 0 Req 3B Haas Company Absorption Costing Income Statement Year 1 Req 3B Compute the unit product cost for Year 1, Year 2, and Year 3. Assume the company uses absorption costing. (Round your intermediate calculations and final answers to 2 decimal places.) Year 2 Year 3 0 $ Year 2 < Req 3A Req 3B 0 0 0 0 Req 3B Year 2 0 Req 2B > Prepare an income statement for Year 1, Year 2, and Year 3. Assume the company uses absorption costing. (Round your intermediate calculations to 2 decimal places.) $ Year 3 0 $ Req 3B > 0 0 Req 3A > 0 0 Year 3 0 0 Req 3B >
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