During Heaton Company's first two years of operations, it reported absorption costing net operating income as f Year 1 Year 2 $ 1,054,000 $1,674,000 527,000 837,000 527,000 837,000 304,000 334,000 $ 223,000 $ 503,000 Sales (@ $62 per unit) Cost of goods sold (@ $31 per unit) Gross margin Selling and administrative expenses* Net operating income $3 per unit variable; $253,000 fixed each year. The company's $31 unit product cost is computed as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead ($264,000+ 22,000 units) Absorption costing unit product cost Production and cost data for the first two years of operations are: Year 1 Year 2 22,000 22,000 17,000 27,000 Units produced Units sold $6 10 3 12 $ 31 Required: 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? B. 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 f Year 1 Year 2 $ 1,054,000 $1,674,000 527,000 837,000 527,000 837,000 304,000 334,000 $ 223,000 $ 503,000 Sales (@ $62 per unit) Cost of goods sold (@ $31 per unit) Gross margin Selling and administrative expenses* Net operating income $3 per unit variable; $253,000 fixed each year. The company's $31 unit product cost is computed as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead ($264,000+ 22,000 units) Absorption costing unit product cost Production and cost data for the first two years of operations are: Year 1 Year 2 22,000 22,000 17,000 27,000 Units produced Units sold $6 10 3 12 $ 31 Required: 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? B. Reconcile the absorption costing and the variable costing net operating income figures for each year.

Name: Do not give answer in image During Heaton Company's first two years of
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Description: Do not give answer in image During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows:Year 1Year 2$ 1,054,000 $1,674,000Sales (@ $62 per unit)Cost of goods sold (@ $31 per unit)Gross marginS

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 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 (@ $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 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 (@ $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…