Merritt Systems, which has only one product, has provided the following data concerning its most recent month of operations: • Selling Price: $140 Units in Beginning Inventory: 0 • Units Produced: 8,000 • Units Sold: 7,600 • • Units in Ending Inventory: 400 Direct Materials: $22 • Direct Labor: $50 . • • • Variable Manufacturing Overhead: $13 Variable Selling and Administrative: $12 Fixed Manufacturing Overhead: $210,000 Fixed Selling and Administrative: $30,000 What is the unit product cost for the month under variable costing? a. $85 per unit b. $97 per unit c. $73 per unit d. $118 per unit

Merritt Systems, which has only one product, has provided the following data concerning its most recent month of operations: • Selling Price: $140 Units in Beginning Inventory: 0 • Units Produced: 8,000 • Units Sold: 7,600 • • Units in Ending Inventory: 400 Direct Materials: $22 • Direct Labor: $50 . • • • Variable Manufacturing Overhead: $13 Variable Selling and Administrative: $12 Fixed Manufacturing Overhead: $210,000 Fixed Selling and Administrative: $30,000 What is the unit product cost for the month under variable costing? a. $85 per unit b. $97 per unit c. $73 per unit d. $118 per unit

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter2: Basic Cost Management Concepts

Section: Chapter Questions

Problem 22E: Ellerson Company provided the following information for the last calendar year: During the year,...

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Ellerson Company provided the following information for the last calendar year: During the year, direct materials purchases amounted to 278,000, direct labor cost was 189,000, and overhead cost was 523,000. During the year, 100,000 units were completed. Required: 1. Calculate the total cost of direct materials used in production. 2. Calculate the cost of goods manufactured. Calculate the unit manufacturing cost. 3. Of the unit manufacturing cost calculated in Requirement 2, 2.70 is direct materials and 5.30 is overhead. What is the prime cost per unit? Conversion cost per unit?
Pattison Products, Inc., began operations in October and manufactured 40,000 units during the month with the following unit costs: Fixed overhead per unit = 280,000/40,000 units produced = 7. Total fixed factory overhead is 280,000 per month. During October, 38,400 units were sold at a price of 24, and fixed marketing and administrative expenses were 130,500. Required: 1. Calculate the cost of each unit using absorption costing. 2. How many units remain in ending inventory? What is the cost of ending inventory using absorption costing? 3. Prepare an absorption-costing income statement for Pattison Products, Inc., for the month of October. 4. What if November production was 40,000 units, costs were stable, and sales were 41,000 units? What is the cost of ending inventory? What is operating income for November?
Glasson Manufacturing Co. produces only one product. You have obtained the following information from the corporations books and records for the current year ended December 31, 2016: a. Total manufacturing cost during the year was 1,000,000, including direct materials, direct labor, and factory overhead. b. Cost of goods manufactured during the year was 970,000. c. Factory Overhead charged to Work in Process was 75% of direct labor cost and 27% of the total manufacturing cost. d. The beginning Work in Process inventory, on January 1, was 40% of the ending Work in Process inventory, on December 31. e. Material purchases were 400,000 and the ending balance in Materials inventory was 60,000. No indirect materials were used in production. Required: Prepare a statement of cost of goods manufactured for the year ended December 31 for Glasson Manufacturing. (Hint: Set up a statement of cost of goods manufactured, putting the given information in the appropriate spaces and solving for the unknown information.)
Orinder Company provided the following information for the last calendar year: During the year, direct materials purchases amounted to 275,800, direct labor cost was 153,000, and overhead cost was 267,300. There were 25,000 units produced. Unit manufacturing cost (rounded to the nearest cent) is a. 28.40 b. 27.98 c. 34.95 d. 27.55
During the week of May 10, Hyrum Manufacturing produced and shipped 16,000 units of its aluminum wheels: 4,000 units of Model A and 12,000 units of Model B. The cycle time for Model A is 1.09 hours and for Model B is 0.47 hour. The following costs and production hours were incurred: Required: 1. Assume that the value-stream costs and total units shipped apply only to one model (a single-product value stream). Calculate the unit cost, and comment on its accuracy. 2. Assume that Model A is responsible for 40% of the materials cost. Calculate the unit cost for Models A and B, and comment on its accuracy. Explain the rationale for using units shipped instead of units produced in the calculation. 3. Calculate the unit cost for the two models, using DBC. Explain when and why this cost is more accurate than the unit cost calculated in Requirement 2.
Last year, Orsen Company produced 25,000 juicers and sold 26,500 juicers for 60 each. The actual variable unit cost is as follows: Fixed overhead was 320,000. Fixed selling expenses consisted of advertising copayments totaling 110,000. Fixed administrative expenses were 236,000. There were no beginning and ending work-in-process inventories. Beginning finished goods inventory was 148,000 for 4,000 juicers. The value of ending inventory reported on the financial statements was a. 55,500 b. 92,500 c. 66,500 d. 39,900
Last year, Orsen Company produced 25,000 juicers and sold 26,500 juicers for 60 each. The actual variable unit cost is as follows: Fixed overhead was 320,000. Fixed selling expenses consisted of advertising copayments totaling 110,000. Fixed administrative expenses were 236,000. There were no beginning and ending work-in-process inventories. Beginning finished goods inventory was 148,000 for 4,000 juicers. The value of ending inventory reported on the financial statements was Refer to the information in 2.24. The gross margin percentage for last year was a. 12.57% b. 55.67% c. 28.95% d. 38.33%
Kildeer Company makes easels for artists. During the last calendar year, a total of 30,000 easels were made, and 31,000 were sold for 52 each. The actual unit cost is as follows: The selling expenses consisted of a commission of 1.30 per unit sold and advertising copayments totaling 95,000. Administrative expenses, all fixed, equaled 183,000. There were no beginning and ending work-in-process inventories. Beginning finished goods inventory was 132,600 for 3,400 easels. Required: 1. Calculate the number and the dollar value of easels in ending finished goods inventory. 2. Prepare a cost of goods sold statement. 3. Prepare an absorption-costing income statement. Add a column for percentage of sales.
Hadley Corporation, which has only one product, has provided the following data concerning its most recent month of operations: Selling price $ 126Units in beginning inventory 0Units produced 1,900Units sold 1,800Units in ending inventory 100 Variable costs per unit: Direct materials $ 49Direct labor $ 28Variable manufacturing overhead $ 5Variable selling and administrative expense $ 11Fixed costs: Fixed manufacturing overhead $ 32,300Fixed selling and administrative expense $ 23,400 What is the total period cost for the month under variable costing?$75,500$43,200$32,300$55,700
Farris Corporation, which has only one product, has provided the following data concerning its most recent month of operations:Selling price $173Units in beginning inventory 1,450Units produced 9,350Units sold 9,450Units in ending inventory 1,350 Variable costs per unit: Direct materials $ 39Direct labor $ 56Variable manufacturing overhead $ 20Variable selling and administrative expense $30Fixed costs: Fixed manufacturing overhead $ 74,800Fixed selling and administrative expense $167,200 The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. What is the net operating income for the month under ABSORPTION COSTING?$5,100$22,600$21,800$34,100
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Farris Corporation, which has only one product, has provided the following data concerning its most recent month of operations: Selling price $ 78Units in beginning inventory 0Units produced 8,800Units sold 8,700Units in ending inventory 100 Variable costs per unit: Direct materials $ 18Direct labor $ 10Variable manufacturing overhead $ 4Variable selling and administrative expense $ 5Fixed costs: Fixed manufacturing overhead $ 255,200Fixed selling and administrative expense $ 87,000 What is the net operating income for the month under absorption costing?$11,300$17,400$14,500$2,900