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$ 1,159,000$ 1,769,000Sales (@ $61 per unit)Cost of goods sold (@ $36 per unit) 684,000Gross margin475,000Selling and administrative expenses* 303,000Net operating income$ 172,000*$3 per unit variable; $246,000 fixed each year.The company's $36 unit product cost is computed as follows:Direct materialsDirect laborShow Transcribed Text1,044,000725,000Net operating income (loss)333,000Variable manufacturing overheadFixed manufacturing overhead ($288,000 ÷ 24,000 units) 12Absorption costing unit product cost$36Production and cost data for the first two years of operations are:Year 1Year 2Units produced 24,00024,000Units sold 19,000 29,000Required:1. Using variable costing, what is the unit product cost for both years?Year 1$ 392,000Using variable costing, what is the unit product cost for both years?Unit product cost$8Required 1 Required 2 Required 3112. What is the variable costing net operating income in Year 1 and in Year 2?Required 1 Required 2 Required 3What is the variable costing net operating income in Year 1 and in Year 2? (Loss amounts should be indicated with a minussign.)5Year 23. Reconcile the absorption costing and the variable costing net operating income figures for each year.Complete this question by entering your answers in the tabs below.Reconcile the absorption costing and the variable costing net operating income figures for each year.Reconciliation of Variable Costing and Absorption Costing Net Operating IncomesYear 1Variable costing net operating income (loss)Add (deduct) fixed manufacturing overhead deferred in (released from) inventory underabsorption costingAbsorption costing net operating incomeYear 2

Using variable costing, only variable manufacturing costs are included in the product cost. The net…

During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows: Year 1 Year 2 $ 1,159,000 $ 1,769,000 Sales (@ $61 per unit) Cost of goods sold (@ $36 per unit) 684,000 Gross margin 475,000 1,044,000 725,000 333,000 Selling and administrative expenses* 303,000 Net operating income $ 172,000 *$3 per unit variable; $246,000 fixed each year. The company's $36 unit product cost is computed as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead ($288,000 ÷ 24,000 units) 12 Absorption costing unit product cost $36 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 $ 392,000 $8 11 5 Required: 1. Using variable costing, what is the unit product cost for both years? Using variable costing, what is the unit product cost for both years? Unit product cost

During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows: Year 1 Year 2 $ 1,159,000 $ 1,769,000 Sales (@ $61 per unit) Cost of goods sold (@ $36 per unit) 684,000 Gross margin 475,000 1,044,000 725,000 333,000 Selling and administrative expenses* 303,000 Net operating income $ 172,000 *$3 per unit variable; $246,000 fixed each year. The company's $36 unit product cost is computed as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead ($288,000 ÷ 24,000 units) 12 Absorption costing unit product cost $36 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 $ 392,000 $8 11 5 Required: 1. Using variable costing, what is the unit product cost for both years? Using variable costing, what is the unit product cost for both years? Unit product cost

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter2: Basic Cost Management Concepts

Section: Chapter Questions

Problem 22E: Ellerson Company provided the following information for the last calendar year: During the year,...

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During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows: Year 1 Year 2 Sales (@ $62 per unit) $ 1,178,000 $1,798,000 Cost of goods sold (@ $36 per unit) 684,000 1,044,000 Gross margin 494,000 754,000 Selling and administrative expenses * 305,000 335,000 Net operating income $ 189,000 $ 419,000 * $3 per unit variable; $248,000 fixed each year. The company's $36 unit product cost is computed as follows: Direct materials $ 9 Direct labor 10 Variable manufacturing overhead 4 Fixed manufacturing overhead ($312,000 - 24,000 units) 13 Absorption costing unit product cost $36 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: Using variable costing, what is the unit product cost for both years? What is the variable costing net operating income in Year 1 and in Year 2? Reconcile the absorption costing and the variable costing net operating…
During Heaton Company’s first two years of operations, it reported absorption costing net operating income as follows: Year 1 Year 2 Sales (@ $61 per unit) $ 1,098,000 $ 1,708,000 Cost of goods sold (@ $38 per unit) 684,000 1,064,000 Gross margin 414,000 644,000 Selling and administrative expenses* 306,000 336,000 Net operating income $ 108,000 $ 308,000 * $3 per unit variable; $252,000 fixed each year. The company’s $38 unit product cost is computed as follows: Direct materials $ 6 Direct labor 9 Variable manufacturing overhead 3 Fixed manufacturing overhead ($460,000 ÷ 23,000 units) 20 Absorption costing unit product cost $ 38 Production and cost data for the first two years of operations are: Year 1 Year 2 Units produced 23,000 23,000 Units sold 18,000 28,000 Required: 1. Using variable costing, what is the unit product cost for both years? 2. What is the variable costing net…
During Heaton Company’s first two years of operations, it reported absorption costing net operating income as follows: Year 1 Year 2 Sales (@ $61 per unit) $ 1,098,000 $ 1,708,000 Cost of goods sold (@ $36 per unit) 648,000 1,008,000 Gross margin 450,000 700,000 Selling and administrative expenses* 305,000 335,000 Net operating income $ 145,000 $ 365,000 * $3 per unit variable; $251,000 fixed each year. The company’s $36 unit product cost is computed as follows: Direct materials $ 7 Direct labor 9 Variable manufacturing overhead 2 Fixed manufacturing overhead ($414,000 ÷ 23,000 units) 18 Absorption costing unit product cost $ 36 Production and cost data for the first two years of operations are: Year 1 Year 2 Units produced 23,000 23,000 Units sold 18,000 28,000 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.…
During Heaton Company's first two years of operations, it reported absorption costing net operating income as follws: Year 2 Sales (e $64 per unit) Cost of goods sold (e $37 per unit) Gross margin Selling and administrative expenses Year 1 $ 1,152, 000 $ 1,792, 000 666, 000 486, 000 301, 000 $ 185, 000 1,836, 000 756, 000 331, 000 $ 425, 000 Net operating incone •$3 per unit varlable, $247,000 fixed each year. The company's $37 unit product cost is computed as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufactüring overhead ($391, 00e + 23, 000 units) $ 6 10 4. 17 $ 37 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 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…
During Heaton Company’s first two years of operations, it reported absorption costing net operating income as follows: Year 1 Year 2 Sales (@ $62 per unit) $ 1,178,000 $ 1,798,000 Cost of goods sold (@ $40 per unit) 760,000 1,160,000 Gross margin 418,000 638,000 Selling and administrative expenses* 303,000 333,000 Net operating income $ 115,000 $ 305,000 * $3 per unit variable; $246,000 fixed each year. The company’s $40 unit product cost is computed as follows: Direct materials $ 8 Direct labor 10 Variable manufacturing overhead 3 Fixed manufacturing overhead ($456,000 ÷ 24,000 units) 19 Absorption costing unit product cost $ 40 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…
During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows: Year 1 Year 2 $ 1,037,000 $ 1,647,000 945,000 Sales (@ $61 per unit) Cost of goods sold (@ $35 per unit) Gross margin Selling and administrative expenses* 595,000 442,000 303,000 702,000 333,000 Net operating income $4 139,000 369,000 $3 per unit variable; $252,000 fixed each year. The company's $35 unit product cost is computed as follows: Direct materials 7 Direct labor 8. Variable manufacturing overhead Fixed manufacturing overhead ($418,000 + 22,000 units) 1 19 Absorption costing unit product cost $ 35 Production and cost data for the first two years of operations are: Year 1 Year 2 Units produced Units sold 22,000 17,000 22,000 27,000 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…
During Heaton Company’s first two years of operations, it reported absorption costing net operating income as follows: Year 1 Year 2 Sales (@ $25 per unit) $ 1,000,000 $ 1,250,000 Cost of goods sold (@ $18 per unit) 720,000 900,000 Gross margin 280,000 350,000 Selling and administrative expenses* 210,000 230,000 Net operating income $ 70,000 $ 120,000 *$2 per unit variable; $130,000 fixed each year. The company’s $18 unit product cost is computed as follows: Direct materials $ 4 Direct labor 7 Variable manufacturing overhead 1 Fixed manufacturing overhead ($270,000 ÷ 45,000 units) 6 Absorption costing unit product cost $ 18 Forty percent of fixed manufacturing overhead consists of wages and salaries; the remainder consists of depreciation charges on production equipment and buildings. Production and cost data for the first two years of operations are: Year 1 Year 2 Units produced 45,000 45,000 Units sold…
During Heaton Company’s first two years of operations, it reported absorption costing net operating income as follows: Year 1 Year 2 Sales (@ $63 per unit) $ 1,197,000 $ 1,827,000 Cost of goods sold (@ $41 per unit) 779,000 1,189,000 Gross margin 418,000 638,000 Selling and administrative expenses* 305,000 335,000 Net operating income $ 113,000 $ 303,000 * $3 per unit variable; $248,000 fixed each year. The company’s $41 unit product cost is computed as follows: Direct materials $ 7 Direct labor 13 Variable manufacturing overhead 2 Fixed manufacturing overhead ($456,000 ÷ 24,000 units) 19 Absorption costing unit product cost $ 41 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…
During Heaton Company’s first two years of operations, it reported absorption costing net operating income as follows: Year 1 Year 2 Sales (@ $64 per unit) $ 1,088,000 $ 1,728,000 Cost of goods sold (@ $35 per unit) 595,000 945,000 Gross margin 493,000 783,000 Selling and administrative expenses* 303,000 333,000 Net operating income $ 190,000 $ 450,000 * $3 per unit variable; $252,000 fixed each year. The company’s $35 unit product cost is computed as follows: Direct materials $ 8 Direct labor 12 Variable manufacturing overhead 2 Fixed manufacturing overhead ($286,000 ÷ 22,000 units) 13 Absorption costing unit product cost $ 35 Forty percent of fixed manufacturing overhead consists of wages and salaries; the remainder consists of depreciation charges on production equipment and buildings. Production and cost data for the first two years of operations are: Year 1 Year 2 Units produced…