Homework Help is Here – Start Your Trial Now!
Business
Accounting
During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows: Sales (@ $61 per unit) Cost of goods sold (@$31 per unit) Gross margin Selling and administrative expenses Net operating income *$3 per unit variable; $252,000 fixed each year. The company's $31 unit product cost is computed as follows: Year 1 $ 1,098,000 558,000 540,000 306,000 $ 234,000 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead ($345,000 + 23,000 units) Absorption costing unit product cost Production and cost data for the first two years of operations are: Year 2 23,000 28,000 Units produced Units sold Year 1 23,000 18,000 Year 2 $ 1,708,000 868,000 840,000 336,000 $ 504,000 $7 1 15 $ 31 Required: 1. Using variable costing, what is the unit product cost for both years? 2. What is the variable costing net operating income in Year 1 and in Year 2? 3. Reconcile the absorption costing and the variable costing net operating income figures for each year.

During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows: Sales (@ $61 per unit) Cost of goods sold (@$31 per unit) Gross margin Selling and administrative expenses Net operating income *$3 per unit variable; $252,000 fixed each year. The company's $31 unit product cost is computed as follows: Year 1 $ 1,098,000 558,000 540,000 306,000 $ 234,000 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead ($345,000 + 23,000 units) Absorption costing unit product cost Production and cost data for the first two years of operations are: Year 2 23,000 28,000 Units produced Units sold Year 1 23,000 18,000 Year 2 $ 1,708,000 868,000 840,000 336,000 $ 504,000 $7 1 15 $ 31 Required: 1. Using variable costing, what is the unit product cost for both years? 2. What is the variable costing net operating income in Year 1 and in Year 2? 3. Reconcile the absorption costing and the variable costing net operating income figures for each year.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question

Please help me with all answers thanku 

During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows: Sales (@ $61 per unit) Cost of goods sold (@ $31 per unit) Gross margin Selling and administrative expenses* Net operating income *$3 per unit variable; $252,000 fixed each year. The company's $31 unit product cost is computed as follows: Direct materials Direct labor Year 1 $ 1,098,000 558,000 540,000 306,000 $ 234,000 Variable manufacturing overhead Fixed manufacturing overhead ($345,000 + 23,000 units) Absorption costing unit product cost Production and cost data for the first two years of operations are: Units produced Units sold Year 1 23,000 18,000 Year 2 23,000 28,000 Year 2 $ 1,708,000 868,000 840,000 336,000 $ 504,000 $7 8 1 15 $31 Required: 1. Using variable costing, what is the unit product cost for both years? 2. What is the variable costing net operating income in Year 1 and in Year 2? 3. Reconcile the absorption costing and the variable costing net operating income figures for each year.
Transcribed Image Text:During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows: Sales (@ $61 per unit) Cost of goods sold (@ $31 per unit) Gross margin Selling and administrative expenses* Net operating income *$3 per unit variable; $252,000 fixed each year. The company's $31 unit product cost is computed as follows: Direct materials Direct labor Year 1 $ 1,098,000 558,000 540,000 306,000 $ 234,000 Variable manufacturing overhead Fixed manufacturing overhead ($345,000 + 23,000 units) Absorption costing unit product cost Production and cost data for the first two years of operations are: Units produced Units sold Year 1 23,000 18,000 Year 2 23,000 28,000 Year 2 $ 1,708,000 868,000 840,000 336,000 $ 504,000 $7 8 1 15 $31 Required: 1. Using variable costing, what is the unit product cost for both years? 2. What is the variable costing net operating income in Year 1 and in Year 2? 3. Reconcile the absorption costing and the variable costing net operating income figures for each year.
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 5 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS