During its first year of operations, a company produced 275,000 units and sold 250,000 units.The following costs were incurred during the year:Fixed CostsDirect materialsDirect laborVariable Cost per Unit$15.0010.00$2,200,0001,375,00012.50Manufacturing overheadSelling and administrativeThe difference between operating income calculated on the absorption-costing basis and onthe variable costing basis is that absorption-costing operating income is (Your response mustbe i.e., "12000 greater" or "12000 lesser".)2.50

Name: During its first year of operations, a company produced 275,000 units
Uploaded: 2024-03-20T06:32:49.000Z
Channel: Bartleby
Description: During its first year of operations, a company produced 275,000 units and sold 250,000 units.The following costs were incurred during the year:Fixed CostsDirect materialsDirect laborVariable Cost per Unit$15.0010.00$2,200,0001,375,00012.50Manufactur

Under absorption costing, the product cost consists of bot variable and fixed. Under variable…

Business

Accounting

During its first year of operations, a company produced The following costs were incurred during the year: Fixed Costs Variable Cost per Unit $15.00 Direct materials Direct labor 10.00 12.50 2.50 $2,200,000 1,375,000 Manufacturing overhead Selling and administrative The difference between operating income calculated on the absorption-costing basis and on the variable costing basis is that absorption-costing operating income is (Your response must be i.e., "12000 greater" or "12000 lesser".)

During its first year of operations, a company produced The following costs were incurred during the year: Fixed Costs Variable Cost per Unit $15.00 Direct materials Direct labor 10.00 12.50 2.50 $2,200,000 1,375,000 Manufacturing overhead Selling and administrative The difference between operating income calculated on the absorption-costing basis and on the variable costing basis is that absorption-costing operating income is (Your response must be i.e., "12000 greater" or "12000 lesser".)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Please help me figure a-d
Foggs Corporation has provided the following data for its two most recent years of operation: Manufacturing costs: Variable manufacturing cost per unit produced: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead per year Selling and administrative expenses: Variable selling and administrative expense per unit sold Fixed selling and administrative expense per year Year 2 1,000 Year 1 Units in beginning inventory 0 $21.00 $67.00 $ 10 $6 $5 $ 520,000 $6 $ 63,000 Units produced during the year 10,000 13,000 Units sold during the year 9,000 11,000 Units in ending inventory 1,000 3,000 The unit product cost under absorption costing in Year 2 is closest to: Multiple Choice $40.00
Prepare an absorption-costing income statement for last year. Round to nearest whole number.
Wolsey Industries Inc. expects to maintain the same inventories at the end of 20Y8 as at the beginning of the year. The total of all production costs for the year is therefore assumed to be equal to the cost of goods sold. With this in mind, the various department heads were asked to submit estimates of the costs for their departments during the year A summary report of these estimates is as follows: Estimated Fixed Cost Estimated Variable Cost (per unit sold) 2 Production costs: 3 Direct materials 4 Direct labor 5 Factory overhead $56.00 36.00 $194,000.00 20.00 6 Selling expenses: 7 Sales salaries and commissions 110,000.00 8.00 8 Advertising 42,000.00 9 Travel 13,000.00 10 Miscellaneous selling expense 7,000.00 1.00 11 Administrative expenses: 12 Office and officers' salaries 13 Supplies 124,600.00 8,000.00 6.00
During the past year, Gutter Corp., operated within the relevant range of its fixed costs. Monthly production volume during the year ranged from 78,000 to 130,000 units of product and corresponding total manufacturing costs ranged from $6.15 to $4.75 per unit. Determine the total cost behavior pattern experienced by Gutter Corp.
Calculate and Use Ovrehead Rate During the coming accounting year, Baker Manufacturing, Inc. anticipates the following costs, expenses, and operating data: Direct material (16,000 lb) $80,000 Direct labor (@10/hr) 200,000 Indirect materials 12,000 Indirect labor 22,000 Sales Commissions 34,000 Factory administration 16,000 Nonfactory administrative expenses 20,000 Other manufacturing overhead 80,000 a. Calculate the predetermined manufacturing overhead rate for the coming year for each of the following application bases: (1) direct labor hours, (2) direct labor costs, and (3) machine hours. b. For each item in requirement in requirement a, determine the proper application of manufacuring overhead to Job 63, to which 16 direct labor hours, $150 of direct labor cost, and 40 machine…
Whitman Company has just completed its first year of operations. The company's absorption costing income statement for the year follows: Whitman Company Income Statement Sales (39,000 units x $42.10 per unit) Cost of goods sold (39,000 units x $23 per unit) Gross margin Selling and administrative expenses Net operating income The company's selling and administrative expenses consist of $292,500 per year in fixed expenses and $4 per unit sold in variable expenses. The $23 unit product cost given above is computed as follows: Direct materials. Direct labor Variable manufacturing overhead Fixed manufacturing overhead ($306,000+ 51,000 units) Absorption costing unit product cost $ 1,641,900 897,000 744,900 448,500 $ 296,400 Required 1 Required 2 $10 4 3 6 $23 Required: 1. Redo the company's income statement in the contribution format using variable costing. 2. Reconcile any difference between the net operating income on your variable costing income statement and the net operating income on…
Po.8.
Farrow Company reports the following annual results. Contribution Margin Income Statement Per Unit Annual Total Sales (240,000 units) $ 15.00 $ 3,600,000 Variable costs Direct materials 2.00 480,000 Direct labor 4.00 960,000 Overhead 2.50 600,000 Contribution margin 6.50 1,560,000 Fixed costs Fixed overhead 2.00 480,000 Fixed general and administrative 1.50 360,000 Income $ 3.00 $ 720,000 The company receives a special offer for 24,000 units at $12 per unit. The additional sales would not affect its normal sales. Variable costs per unit would be the same for the special offer as they are for the normal units. The special offer would require incremental fixed overhead of $96,000 and incremental fixed general and administrative costs of $103,000. (a) Compute the income or loss for the special offer.(b) Should the company accept or reject the special offer? Compute the income or loss for the special offer. (Round your "Per Unit" answers to 2…
Rey Company's only product sells for $228 per unit. Data for Its first year of operations follow. $ 32 per unit $ 40 per unit $ 12 per unit $385,000 per year $ 30 per unit $ 224,000 per year 27,500 units Direct materials Direct labor Variable overhead Fixed overhead Variable selling and administrative expenses Fixed selling and administrative expenses Units produced and sold 1. Prepare an Income statement for the year using absorption costing 2. Prepare an income statement for the year using varlable costing. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare an income statement for the year using absorption costing, REY COMPANY Income Statement (Absorption Costing) Sales Cost of goods sold Gross profit Selling and administrative expenses Income Required 1 Required 2 Sales Less Variable expenses * Answer is not complete. Income Prepare an income statement for the year using variable costing. Direct materials Direct labor Variable cost of…
Locklear, Inc. reports the following information for the year ended December 31: Units sold Sales price Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative costs Fixed selling and administrative costs 650 units $160 per unit $25 per unit $11 per unit $15 per unit $25 per unit $6 per unit $12,600 per year The operating income calculated using variable costing and absorption costing amounted to $9,100 and $10,300, respectively. There were no beginning inventories. Determine the total fixed manufacturing overhead that will be expensed under absorption costing for the year. OA. $32,500 B. $16,250 C. $17,450 D. $33,150
Crane Company recorded operating data for its shoe division for the year as follows: Sales Contribution margin Controllable fixed costs Average total operating assets $12960000 O $540000 O $370000 O 24% 50% 540000 170000 1080000 What is the controllable margin for the year?