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 $ 27 $ 17 $5 $2 $ 510,000 $ 110,000 During its first year of operations, O'Brien produced 99,000 units and sold 72,000 units. During its second year of operations, it produced 78,000 units and sold 100,000 units. In its third year, O'Brien produced 89,000 units and sold 84,000 units. The selling price of the company's product is $71 per unit. Required: 1. Assume the company uses variable costing and a FIFO inventory flow assumption (FIFO means first-in first-out. In other words, it assumes that the oldest units in inventory are sold first): a. Compute the unit product cost for Year 1, Year 2, and Year 3. h Prepare an income statement for Year 1, Year 2, and Year 3.
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 $ 27 $ 17 $5 $2 $ 510,000 $ 110,000 During its first year of operations, O'Brien produced 99,000 units and sold 72,000 units. During its second year of operations, it produced 78,000 units and sold 100,000 units. In its third year, O'Brien produced 89,000 units and sold 84,000 units. The selling price of the company's product is $71 per unit. Required: 1. Assume the company uses variable costing and a FIFO inventory flow assumption (FIFO means first-in first-out. In other words, it assumes that the oldest units in inventory are sold first): a. Compute the unit product cost for Year 1, Year 2, and Year 3. h Prepare an income statement for Year 1, Year 2, and Year 3.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Please do not give solution in image format thanku
![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
$ 27
$ 17
$5
$2
$ 510,000
$ 110,000
During its first year of operations, O'Brien produced 99,000 units and sold 72,000 units. During its second year of
operations, it produced 78,000 units and sold 100,000 units. In its third year, O'Brien produced 89,000 units and sold
84,000 units. The selling price of the company's product is $71 per unit.
Required:
1. Assume the company uses variable costing and a FIFO inventory flow assumption (FIFO means first-in first-out. In other words, it
assumes that the oldest units in inventory are sold first):
a. Compute the unit product cost for Year 1, Year 2, and Year 3.
h. Prepare an income statement for Year 1. Year 2, and Year 3.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd73300bb-6162-4ed3-b66f-6556c243d10a%2Fbbfb9948-a53a-416a-afe1-a546282b0a9e%2F3667m3_processed.jpeg&w=3840&q=75)
Transcribed Image Text: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
$ 27
$ 17
$5
$2
$ 510,000
$ 110,000
During its first year of operations, O'Brien produced 99,000 units and sold 72,000 units. During its second year of
operations, it produced 78,000 units and sold 100,000 units. In its third year, O'Brien produced 89,000 units and sold
84,000 units. The selling price of the company's product is $71 per unit.
Required:
1. Assume the company uses variable costing and a FIFO inventory flow assumption (FIFO means first-in first-out. In other words, it
assumes that the oldest units in inventory are sold first):
a. Compute the unit product cost for Year 1, Year 2, and Year 3.
h. Prepare an income statement for Year 1. Year 2, and Year 3.
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