High Country, Incorporated, produces and sells many recreational products. The company just opened a new plant to produce a folding camp cot that will be marketed throughout the United States. The following cost and revenue data relate to May, the first month of the plant's operation: Beginning inventory Units produced Units sold Selling price per unit Selling and administrative expenses: Variable per unit Fixed (per month) Manufacturing costs: Direct materials cost per unit Direct labor cost per unit Variable manufacturing overhead cost per unit Fixed manufacturing overhead cost (per month) Required: 1. Assume the company uses absorption costing. a. Calculate the camp cot's unit product cost. Prepare an income statement for May. 2. Assume the company uses variable costing. a. Calculate the camp cot's unit product cost. b. Prepare a contribution format income statement for May. Required 1A Complete this question by entering your answers in the table below. Required 1B Required 2A Required 2B Unit product cost 0 47,000 42,000 $83 $3 $ 564,000 < Required 1A $14 $9 $3 $ 752,000 Determine the camp cot's unit product cost. Assume the company uses absorption costing. Required 1B >
High Country, Incorporated, produces and sells many recreational products. The company just opened a new plant to produce a folding camp cot that will be marketed throughout the United States. The following cost and revenue data relate to May, the first month of the plant's operation: Beginning inventory Units produced Units sold Selling price per unit Selling and administrative expenses: Variable per unit Fixed (per month) Manufacturing costs: Direct materials cost per unit Direct labor cost per unit Variable manufacturing overhead cost per unit Fixed manufacturing overhead cost (per month) Required: 1. Assume the company uses absorption costing. a. Calculate the camp cot's unit product cost. Prepare an income statement for May. 2. Assume the company uses variable costing. a. Calculate the camp cot's unit product cost. b. Prepare a contribution format income statement for May. Required 1A Complete this question by entering your answers in the table below. Required 1B Required 2A Required 2B Unit product cost 0 47,000 42,000 $83 $3 $ 564,000 < Required 1A $14 $9 $3 $ 752,000 Determine the camp cot's unit product cost. Assume the company uses absorption costing. Required 1B >
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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Transcribed Image Text:High Country, Incorporated, produces and sells many recreational products. The company just opened a new plant to produce a
folding camp cot that will be marketed throughout the United States. The following cost and revenue data relate to May, the first
month of the plant's operation:
Beginning inventory
Units produced
Units sold
Selling price per unit
Selling and administrative expenses:
Variable per unit
Fixed (per month)
Manufacturing costs:
Direct materials cost per unit
Direct labor cost per unit
Variable manufacturing overhead cost per unit
Fixed manufacturing overhead cost (per month)
Required:
1. Assume the company uses absorption costing.
a. Calculate the camp cot's unit product cost.
b. Prepare an income statement for May.
2. Assume the company uses variable costing.
a. Calculate the camp cot's unit product cost.
b. Prepare a contribution format income statement for May.
Required 1A Required 1B Required 2A Required 2B
0
47,000
42,000
$ 83
Complete this question by entering your answers in the table below.
Unit product cost
$3
$ 564,000
< Required 1A
$14
$9
$3
$ 752,000
Determine the camp cot's unit product cost. Assume the company uses absorption costing.
Required 1B >
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Step 1: Introduce to income statement
VIEWStep 2: Working for sales revenue
VIEWStep 3: Working for selling and administrative expenses
VIEWStep 4: Working for unit product cost and cost of goods sold using absorption costing
VIEWStep 5: Working for unit product cost and cost of goods sold using variable costing
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