Exercise 7-3 (Algo) Reconciliation of Absorption and Variable Costing Net Operating Incomes [LO7-3] [The following information applies to the questions displayed below.] Jorgansen Lighting, Incorporated, manufactures heavy-duty street lighting systems for municipalities. The company uses variable costing for internal management reports and absorption costing for external reports to shareholders, creditors, and the government. The company has provided the following data: Year 2 Inventories Exercise 7-3 (Algo) Part 1 Year 1 Beginning (units) Ending (units) Variable costing net operating income The company's fixed manufacturing overhead per unit was constant at $550 for all three years. 200 150 $ 300,000 Variable costing net operating income Add (deduct) fixed manufacturing overhead deferred in (released from) inventory under absorption costing Absorption costing net operating income 150 190 $ 269,000 Reconciliation of Variable Costing and Absorption Costing Net Operating Incomes Year 1 Year 2 Year 3 Required: 1. Calculate each year's absorption costing net operating income. (Enter any losses or deductions as a negative value.) Year 3 190 220 $ 250,000

Exercise 7-3 (Algo) Reconciliation of Absorption and Variable Costing Net Operating Incomes [LO7-3] [The following information applies to the questions displayed below.] Jorgansen Lighting, Incorporated, manufactures heavy-duty street lighting systems for municipalities. The company uses variable costing for internal management reports and absorption costing for external reports to shareholders, creditors, and the government. The company has provided the following data: Year 2 Inventories Exercise 7-3 (Algo) Part 1 Year 1 Beginning (units) Ending (units) Variable costing net operating income The company's fixed manufacturing overhead per unit was constant at $550 for all three years. 200 150 $ 300,000 Variable costing net operating income Add (deduct) fixed manufacturing overhead deferred in (released from) inventory under absorption costing Absorption costing net operating income 150 190 $ 269,000 Reconciliation of Variable Costing and Absorption Costing Net Operating Incomes Year 1 Year 2 Year 3 Required: 1. Calculate each year's absorption costing net operating income. (Enter any losses or deductions as a negative value.) Year 3 190 220 $ 250,000

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 confirm my answer is correct
None
Please complete part a and b.
Cost Behavior Cover-to-Cover Company is a manufacturer of shelving for books. The company has compiled the following cost data, and wants your help in determining the cost behavior. After reviewing the data, complete requirements (1) and (2) that follow. Total Total Total Machine Units Lumber Utilities Depreciation Produced Cost Cost Cost 6,000 shelves $72,000 $8,900 $125,000 12,000 shelves 144,000 15,800 125,000 24,000 shelves 288,000 29,600 125,000 30,000 shelves 360,000 36,500 125,000 1. Determine whether the costs in the table are variable, fixed, mizxed, or none of these. Lumber Variable Cost Mixed Cost Depreciation Fixed Cost Number of Units Produced, Total Costs = 2. For each cost, determine the fixed portion of the cost, and the per-unit variable cost. If there is no amount or an amount is zero, enter "0. Recall that, for N = (Variable Cost Per Unit x N) + Fixed Cost. Complete the following table with your answers. Round variable portion of cost (per unit) answers to two…
Question 2 (L03) Yates Corp. wants to develop a cost equation for its administrative costs. The controller believes the appropriate cost driver is units produced. Last year's data are presented below: Month January February March April May June July August September October November December Total Average Units produced 32,500 37,700 24,700 40,300 49,400 42,900 53,300 45,500 26,000 48,100 61,100 54,600 516,100 43,008 Administrative Costs $24,288 27,720 17,820 30,360 37,290 29,040 32,670 30,030 20,460 34,320 40,920 36,630 $361.548 $30,129 Required: (a.) What is the equation for administrative costs using the high-low method? (b.) Prepare an estimate of administrative costs for a month when 30,000 units are produced.
HW Interperiod Measurement of Productivity, Profit-Linked Measurement Print Item Helena Company needs to increase its profits and so has embarked on a program to increase its overall productivity. After one year of operation, Kent Olson, manager of the Columbus plant, reported the following results for the base period and its most recent year of operations: Output Power (quantity used) Materials (quantity used) 20x1 20x2 185,700 217,800 18,570 11,100 37,140 47,100 Suppose the following input prices are provided for each year: Unit price (power) Unit price (materials) 20x1 20x2 $4 16 $5 15 6 8 Unit selling price Required: 1. Compute the profit-linked productivity measure. By how much did profits increase due to productivity? If required, round your intermediate calculations and final answers to the nearest dollar amount. 2. Calculate the price-recovery component for 20x2. If required, round your intermediate calculations and final answers to the nearest dollar amount.
[The following information applies to the questions displayed below.] Jorgansen Lighting, Incorporated, manufactures heavy-duty street lighting systems for municipalities. The company uses variable costing for internal management reports and absorption costing for external reports to shareholders, creditors, and the government. The company has provided the following data: Year 1 Year 2 Year 3 Inventories Beginning (units) 210 160 180 Ending (units ) 160 180 230 Variable costing net operating income $300,000 $ 279,000 $ 260,000 The company's fixed manufacturing overhead per unit was constant at $560 for all three years. Required: 1. Calculate each year's absorption costing net operating income. Note: Enter any losses or deductions as a negative value.
Question 3 A Lighting industry manufactures and sells a single product, heavy-duty battery operated standby lamp. The financial controller has prepared the following income statement for the most recent year: An Industry Income Statement under Absorption costing, for the year ended December 31. Sales Revenue RM2,450,000 Less: Cost of Goods Sold RM1,140,000 Gross Profit RM1,310,000 Less: Operating Expenses RM 750,000 Operating Income RM 560,000 The company produced 40,000 units and sold 30,000 units during the ear ending Dec 31. Fixed manufacturing overhead (MOH) for the year was RM320,000, while fixed operating expenses were RM450,000. Assume per unit cost of Direct Material and direct labor is RM15 and RM12 respectively. The company had no beginning inventory. Requirements Will the company’s operating income under variable costing be higher, lower or the same as operating income under absorption costing? Why? Project the company’s operating income…
! Required information The Foundational 15 (Algo) [LO1-1, LO1₁-2, LO1-3, LO1-4, LO1-5, LO1-6] [The following information applies to the questions displayed below.] Martinez Company's relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its average costs per unit are as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense Average Cost Per Unit $6.70 $ 4.20 $ 1.40 $ 4.00 $ 3.70 $ 2.10 $ 1.10 $ 0.55 Foundational 1-13 (Algo) 13. If the selling price is $22.70 per unit, what is the contribution margin per unit? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. Answer is complete but not entirely correct. $ 9.50 X Contribution margin per unit
! Required information Case 4-29 (Algo) Variable and Absorption Costing Unit Product Costs and Income Statements [LO4-1, LO4-2] [The following information applies to the questions displayed below.] O'Brien Company manufactures and sells one product. The following information pertains to each of the company's first three years of operations: Variable costs per unit: Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses $ 570,000 $ 110,000 During its first year of operations, O'Brien produced 100,000 units and sold 74,000 units. During its second year of operations, it produced 76,000 units and sold 97,000 units. In its third year, O'Brien produced 81,000 units and sold 76,000 units. The selling price of the company's product is $77 per unit. Case 4-29 Part-3 (Algo) 3. Assume the company uses absorption costing and a FIFO inventory flow…
Jay
Vikrambhai