operations:Variable costs per unit:Manufacturing:Direct materialsDirect laborRequired:1. Assume that the company uses absorption costing:a. Compute the unit product cost.b. Prepare an income statement for the year.$ 10$4$1$1Variable manufacturing overheadVariable selling and administrativeFixed costs per year:Fixed manufacturing overhead$ 340,000Fixed selling and administrative.$ 250,000During the year, the company produced 34,000 units and sold 16,000 units. The selling price of the company's product is $54 per unit.2. Assume that the company uses variable costing:a. Compute the unit product cost.b. Prepare an income statement for the year.Return to questAnswer is not complete. SalesVariable expenses:Lynch CompanyVariable Costing Income StatementVariable cost of goods soldBeginning merchandise inventoryVariable cost of goods soldFixed manufacturing overheadFixed manufacturing overheadNet operating incomex$ 510,000 X270,000 X240,000340,000590,000 X$uses$ 864,0001,020,000(156,000)930,000(1,086,000)able

Absorption costing: In the absorption costing, product cost includes direct materials,direct labor…

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 Required: 1. Assume that the company uses absorption costing: a. Compute the unit product cost. b. Prepare an income statement for the year. 2. Assume that the company uses variable costing: $ 10 $4 $1 $1 $ 340,000 $ 250,000 During the year, the company produced 34,000 units and sold 16,000 units. The selling price of the company's product is $54 per unit. a. Compute the unit product cost. b. Prepare an income statement for the year. Return to ques

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 Required: 1. Assume that the company uses absorption costing: a. Compute the unit product cost. b. Prepare an income statement for the year. 2. Assume that the company uses variable costing: $ 10 $4 $1 $1 $ 340,000 $ 250,000 During the year, the company produced 34,000 units and sold 16,000 units. The selling price of the company's product is $54 per unit. a. Compute the unit product cost. b. Prepare an income statement for the year. Return to ques

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows: Sales (@ $62 per unit) Year 1 $ 1,178,000 Gross margin 513,000 Selling and administrative 303,000 expenses* Net operating $ income Cost of goods sold (@$35 665,000 1,015,000 per unit) Year 2 210,000 $ 1,798,000 783,000 333,000 $ 450,000 *$3 per unit variable; $246,000 fixed each year. The company's $35 unit product cost is computed as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead ($360,000 ÷ 24,000 units) Absorption costing unit product cost $9 9 2 15 $ 35
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Dowell Company produces a single product. Its Income under variable costing for its first two years of operation follow. Variable Costing Income Income Units Units produced Units sold Additional Information a. Sales and production data for these first two years follow. Year 1 $ 43,000 Year 1 44,300 33,000 Direct materials Direct labor Variable overhead Fixed overhead ($430,000/43,000 units) Total product cost per unit Variable costing income Year 2 b. The company's $32 per unit product cost (for both years) using absorption costing consists of the following. Absorption costing income 44,300 55,600 Year 2 $ 610,000 Required: Prepare a statement to convert variable costing income to absorption costing income for both years. (Leave no cells blank - be certain to enter "0" wherever required.) $6 Dowell Company Convert Variable Costing Income to Absorption Costing Income Year 1 $ 9 7 10 $32 43,000 $ Year 2 610,000
Lynch Company manufactures and sells a single product. The following costs were incurred during the company's first year of operations: Variable costs per unit: Manufacturing: Direct materials $ 10 Direct labor $7 $3 Variable manufacturing overhead Variable selling and administrative Fixed costs per year: $3 Fixed manufacturing overhead $ 380,000 Pixed selling and administrative $ 290,000 During the year, the company produced 38,000 units and sold 18,000 units. The selling price of the company's product is $61 per unit. Required: 1. Assume that the company uses absorption costing: a. Compute the unit product cost. b. Prepare an income statement for the year. 2. Assume that the company uses variable costing: a. Compute the unit product cost. A b. Prepare an income statement for the year. Complete this question by entering your answers in the tabs below. Req 1A Reg 28 Reg 2A Req 18 Compute the unit product cost. Assume that the company uses absorption costing. During the year, the…
5 Question: computer for product cost per unit under variable costing?