Used variable costing instead of absorption costing? In its first year of operations, KLM Industries hadthe following costs when it produced 120,000units and sold 100,000 units of its only product:Manufacturing costs:Fixed$240,000Variable$180,000Selling and administrative costs:Fixed$110,000Variable$50,000How much lower would KLM's net income be if itused variable costing instead of absorptioncosting?

Explanation of Absorption Costing:Absorption costing is a costing method where all manufacturing…

Answered: In its first year of operations, KLM…

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter3: Cost Behavior And Cost Forecasting

Section: Chapter Questions

Problem 16DQ

See similar textbooks

Similar questions

Suppose that a company is spending 60,000 per year for inspecting, 30,000 for purchasing, and 40,000 for reworking products. A good estimate of nonvalue-added costs would be a. 70,000. b. 130,000. c. 40,000. d. 90,000. e. 100,000.
Please solve this problem
In its first year of operations, MJK Manufacturers had the following costs... Please need answer the accounting question
units?
Calculate Saturn's operating income using absorption costing?
[The following information applies to the questions displayed below.] Burchard Company sold 40,000 units of its only product for $17.00 per unit this year. Manufacturing and selling the product required $310,000 of fixed costs. Its per unit variable costs follow. Direct materials Direct labor Variable overhead costs i Variable selling and administrative costs $4.50 3.50 0.45 0.25 For the next year, management will use a new material, which will reduce direct materials costs to $2.25 per unit and reduce direct labor costs to $1.75 per unit. Sales, total fixed costs, variable overhead costs per unit, and variable selling and administrative costs per unit will not change. Management is also considering raising its selling price to $20.40 per unit, which would decrease unit sales volume to 38,000 units. Problem 21-5A (Algo) Part 1. Required: 1. Compute the contribution margin per unit from (a) using the new material and (b) using the new material and increasing the selling price. (Round…
Company XYZ produced 1,000 units of product A. At this level, the variable manufacturing costs were OMR360,000 and the variable selling and administrative costs were OMR90,000. Furthermore, the total fixed cost was OMR120,000. Assuming the company increased the production level to 1,030 units, what would be the increase in total manufacturing costs? Select one: O a. OMR14,400 O b. OMR10,800 c. None of the given answers O d. OMR13,500 O e. OMR17,100
Blowing Sand Company produces the Drafty model fan, which currently has a net loss of $36,000 as follows: Drafty Model $300,000 210,000 $ 90,000 84,000 $6,000 42,000 $(36,000) Sales revenue Less: Variable costs Contribution margin Less: Direct fixed costs Segment margin Less: Common fixed costs Net operating income (loss) Eliminating the Drafty product line would eliminate $84,000 of direct fixed costs. The $42,000 of common fixed costs would be redistributed to Blowing Sand's remaining product lines. Will Blowing Sand's net operating income increase or decrease if the Drafty model is eliminated? By how much? Total Profit by
If variable manufacturing costs are $15 per unit and total fixed manufacturing costs are $200,000, what is the manufacturing cost per unit if: d. 25,000 units are manufactured and the company uses the absorption costing concept? this is the only one i cant get
The effect on income would be a
I want the correct answer is solution
Lark would estimate fixed costs as .....?

SEE MORE QUESTIONS

Recommended textbooks for you

Managerial Accounting: The Cornerstone of Busines…

Accounting

ISBN:

9781337115773

Author:

Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:

Cengage Learning

EBK CONTEMPORARY FINANCIAL MANAGEMENT

Finance

ISBN:

9781337514835

Author:

MOYER

Publisher:

CENGAGE LEARNING - CONSIGNMENT

Managerial Accounting: The Cornerstone of Busines…

Accounting

ISBN:

9781337115773

Author:

Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:

Cengage Learning

EBK CONTEMPORARY FINANCIAL MANAGEMENT

Finance

ISBN:

9781337514835

Author:

MOYER

Publisher:

CENGAGE LEARNING - CONSIGNMENT

SEE MORE TEXTBOOKS