Please do not give solution in image format thanku During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows:Year 1Year 2$ 1,178,000$ 1,798,000Sales (@ $62 per unit)Cost of goods sold (@ $35 per unit) 665,000Gross margin513,0001,015,000783,000Selling and administrative expenses* 303,000Net operating income$ 210,000*$3 per unit variable; $246,000 fixed each year.The company's $35 unit product cost is computed as follows:Direct materialsDirect labor333,000$ 450,000$99Variable manufacturing overheadFixed manufacturing overhead ($360,000 ÷ 24,000 units) 15Absorption costing unit product cost$ 35Production and cost data for the first two years of operations are:Year 1Year 2Units produced 24,00024,000Units sold 19,00029,0002Required: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.

Unit product cost refers to the cost incurred in factory for the production of goods. Under variable…

During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows: Year 1 Year 2 $ 1,178,000 $1,798,000 1,015,000 783,000 333,000 $ 450,000 Sales (@ $62 per unit) Cost of goods sold (@ $35 per unit) 665,000 Gross margin 513,000 Selling and administrative expenses* 303,000 Net operating income $ 210,000 *$3 per unit variable; $246,000 fixed each year. The company's $35 unit product cost is computed as follows: Direct materials Direct labor $9 9 Variable manufacturing overhead 2 Fixed manufacturing overhead ($360,000+ 24,000 units) 15 Absorption costing unit product cost $ 35 Production and cost data for the first two years of operations are: Year 1 Year 2 Units produced 24,000 24,000 Units sold 19,000 29,000 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: Year 1 Year 2 $ 1,178,000 $1,798,000 1,015,000 783,000 333,000 $ 450,000 Sales (@ $62 per unit) Cost of goods sold (@ $35 per unit) 665,000 Gross margin 513,000 Selling and administrative expenses* 303,000 Net operating income $ 210,000 *$3 per unit variable; $246,000 fixed each year. The company's $35 unit product cost is computed as follows: Direct materials Direct labor $9 9 Variable manufacturing overhead 2 Fixed manufacturing overhead ($360,000+ 24,000 units) 15 Absorption costing unit product cost $ 35 Production and cost data for the first two years of operations are: Year 1 Year 2 Units produced 24,000 24,000 Units sold 19,000 29,000 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

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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