Required information [The following information applies to the questions displayed below] Barnes Company reports the following for its product for its first year of operations. Direct materials Direct labor Variable overhead Fixed overhead Variable selling and administrative expenses Fixed selling and administrative expenses The company sells its product for $140 per unit. Compute gross profit using absorption costing assuming the company (a) produces and sells 2,500 units and (b) produces 3,200 units and sells 2,500 units. Gross profit using absorption costing Gross profit $ 30 per unit $20 per unit $10 per unit $ 80,000 per year $2 per unit $32,000 per year (a) 2,500 Units Produced and 2,500 Units Sold (b) 3,200 Units Produced and 2,500 Units Sold

Required information [The following information applies to the questions displayed below] Barnes Company reports the following for its product for its first year of operations. Direct materials Direct labor Variable overhead Fixed overhead Variable selling and administrative expenses Fixed selling and administrative expenses The company sells its product for $140 per unit. Compute gross profit using absorption costing assuming the company (a) produces and sells 2,500 units and (b) produces 3,200 units and sells 2,500 units. Gross profit using absorption costing Gross profit $ 30 per unit $20 per unit $10 per unit $ 80,000 per year $2 per unit $32,000 per year (a) 2,500 Units Produced and 2,500 Units Sold (b) 3,200 Units Produced and 2,500 Units Sold

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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! Required information [The following information applies to the questions displayed below.] Cool Sky reports the following for its first year of operations. The company produced 44,000 units and sold 36,000 units at a price of $140 per unit. Direct materials Direct labor Variable overhead Fixed overhead Variable selling and administrative expenses Fixed selling and administrative expenses Income Statement (Absorption Costing) 1b. Assume the company uses absorption costing. Prepare its income statement for the year under absorption costing. Sales Cost of goods sold Gross profit Income Income $ $ $ $ 5,040,000 3,240,000 1,800,000 1,404,000 396,000 $ 60 per unit $ 22 per unit $ 8 per unit 528,000 per year $ 11 per unit 105,000 per year
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! Required information [The following information applies to the questions displayed below.] O'Brien Company manufactures and sells one product. The following information pertains to each of the company's first three years of 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 expenses a. Compute the unit product cost for Year 1, Year 2, and Year 3. b. Prepare an income statement for Year 1, Year 2, and Year 3. During its first year of operations, O'Brien produced 98,000 units and sold 74,000 units. During its second year of operations, it produced 80,000 units and sold 99,000 units. In its third year, O'Brien produced 90,000 units and sold 85,000 units. The selling price of the company's product is $78 per unit. Req 4A 4. Assume the company uses absorption costing and a LIFO inventory flow assumption (LIFO…
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