Kildeer Company makes easels for artists. During the last calendar year, a total of 21,000 easels were made, and 22,000 were sold for $52 each. The actual unit cost is as follows: Direct materials Direct labor Variable overhead Fixed overhead Total unit cost Required: Ending units Dollar amount The selling expenses consisted of a commission of $0.80 per unit sold and advertising co-payments totaling $91,500. Administrative expenses, all fixed, equaled $180,500. There were no beginning and ending work-in-process inventories. Beginning finished goods inventory was $109,200 for 2,800 easels. 1. Calculate the number and the dollar value of easels in ending finished goods inventory. Cost of goods sold $15.00 2. Prepare a cost of goods sold statement. Kildeer Company Statement of Cost of Goods Sold For the Year Ended December 31 Sales 4.00 6.00 Cost of goods manufactured Add: Beginning finished goods inventory Cost of goods available for sale Less: Ending finished goods inventory 14.00 Cost of goods sold Gross margin Less operating expenses: Commissions Advertising co-pays Administrative expenses $39.00 Operating income 3. Prepare an absorption-costing income statement. In addition to dollar amounts, enter the amounts as a percent, rounded to two decimal places. For example, .5235 would be 52.35% and you would enter 52.35 as your answer. ✓ Kildeer Company Income Statement: Absorption Costing For the Year Ended December 31 ✓ $ ✓ Percent % % % % %
Kildeer Company makes easels for artists. During the last calendar year, a total of 21,000 easels were made, and 22,000 were sold for $52 each. The actual unit cost is as follows: Direct materials Direct labor Variable overhead Fixed overhead Total unit cost Required: Ending units Dollar amount The selling expenses consisted of a commission of $0.80 per unit sold and advertising co-payments totaling $91,500. Administrative expenses, all fixed, equaled $180,500. There were no beginning and ending work-in-process inventories. Beginning finished goods inventory was $109,200 for 2,800 easels. 1. Calculate the number and the dollar value of easels in ending finished goods inventory. Cost of goods sold $15.00 2. Prepare a cost of goods sold statement. Kildeer Company Statement of Cost of Goods Sold For the Year Ended December 31 Sales 4.00 6.00 Cost of goods manufactured Add: Beginning finished goods inventory Cost of goods available for sale Less: Ending finished goods inventory 14.00 Cost of goods sold Gross margin Less operating expenses: Commissions Advertising co-pays Administrative expenses $39.00 Operating income 3. Prepare an absorption-costing income statement. In addition to dollar amounts, enter the amounts as a percent, rounded to two decimal places. For example, .5235 would be 52.35% and you would enter 52.35 as your answer. ✓ Kildeer Company Income Statement: Absorption Costing For the Year Ended December 31 ✓ $ ✓ Percent % % % % %
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
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Transcribed Image Text:Prime Cost, Conversion Cost, Preparation of Income Statement: Manufacturing Firm.
Kildeer Company makes easels for artists. During the last calendar year, a total of 21,000 easels were
made, and 22,000 were sold for $52 each. The actual unit cost is as follows:
Direct materials
Direct labor
Variable overhead
Fixed overhead
Total unit cost
Required:
Ending units
Dollar amount
The selling expenses consisted of a commission of $0.80 per unit sold and advertising co-payments
totaling $91,500. Administrative expenses, all fixed, equaled $180,500. There were no beginning and
ending work-in-process inventories. Beginning finished goods inventory was $109,200 for 2,800 easels.
1. Calculate the number and the dollar value of easels in ending finished goods inventory.
Sales
$15.00
4.00
2. Prepare a cost of goods sold statement.
Kildeer Company
Statement of Cost of Goods Sold
For the Year Ended December 31
✓
6.00
Cost of goods manufactured
Add: Beginning finished goods inventory
Cost of goods available for sale
Less: Ending finished goods inventory
Cost of goods sold
Cost of goods sold
14.00
3. Prepare an absorption-costing income statement. In addition to dollar amounts, enter the
amounts as a percent, rounded to two decimal places. For example, .5235 would be 52.35%
and you would enter 52.35 as your answer.
Gross margin
Less operating expenses:
Commissions
Advertising co-pays
Administrative expenses
$39.00
Operating income
Kildeer Company
Income Statement: Absorption Costing
For the Year Ended December 31
✓
$
Percent
%
%
%
%
%
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