Required: 1. Assume that the company uses variable costing. Compute the unit product cost for one computer desk. 2. Assume that the company uses variable costing. Prepare an income statement for the year using the contribution format. 3. What is the company's break-even point in terms of units sold?
Required: 1. Assume that the company uses variable costing. Compute the unit product cost for one computer desk. 2. Assume that the company uses variable costing. Prepare an income statement for the year using the contribution format. 3. What is the company's break-even point in terms of units sold?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
ANswer 1 to 3
Transcribed Image Text:Exercise 3 (Variable Costing Unit Product Cost and Income Statement;
Break-even)
PC Desk, Inc., makes an oak desk specially designed for personal computers.
The desk sells for P2,000. Data for last year's operations follow:
Units in beginning inventory.
Units produced...
Units sold. .
Units in ending inventory
.....
10,000
9,000
1,000
...
...
Variable costs per unit:
Direct materials...
Direct labor ...
Variable manufacturing overhead..
Variable selling and administrative
Total variable cost per unit. ..
P 600
300
100
200
P1.200
Fixed costs:
Fixed manufacturing overhead...
Fixed selling and administrative.
Total fixed costs...
P3,000,000
4,500,000
P7,500.000
Required:
1. Assume that the company uses variable costing. Compute the unit product
cost for one computer desk.
2. Assume that the company uses variable costing. Prepare an income
statement for the year using the contribution format.
3. What is the company's break-even point in terms of units sold?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education