I want to answer this question Doc Rowan Corporation sells one product, its waterproofhiking boot. It began operations in the current year and had anending inventory of 8,500 units. The company sold 20,000units throughout the year. Fixed manufacturing overhead is $5per unit, and total manufacturing cost per unit is $20(including fixed manufacturing overhead costs). What is thedifference in net income between absorption and variablecosting?

Step 1: Introduction to the Absorption And Variable CostingOne of the key differences between…

Answered: Doc Rowan Corporation sells one…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter9: Responsibility Accounting And Decentralization

Section: Chapter Questions

Problem 8EA: Using the information in the previous exercises about Marleys Manufacturing, determine the operating...

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Scent Fragrance Company manufactures and sells several ranges of perfumes. The Average revenue and cost of sales are as follows: Selling price per unit $20.00 Variable costs per unit: Direct materials $4.00 Direct manufacturing labor $1.60 Manufacturing overhead $0.40 Selling costs $2.00 Annual fixed costs $96,000 a) Calculate the contribution margin per unit. b) Calculate the number of units Scent Fragrance Company must sell each year to break even. c) Calculate the number of units Scent Fragrance Company must sell to yield a profit of$144,000. d) Managers may use Sensitivity analysis in their accounting system. i) What is sensitivity analysis? ii) How is Sensitivity analysis useful to managers?
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