Income statement with variancesInstructionsIncome StatementInstructionsAlvarado Company produces a product that requires 3.0 standard pounds per unit at a standard price of $6.00 per pound. The companyused 23,900 pounds to produce 8,000 units, which were purchased at $6.20 per pound. Each unit requires 7.5 standard direct labor hoursper unit at a standard hourly rate of $22.50 per hour. For the 8,000 units produced, 60,200 hours were needed and employees were paidan hourly rate of $21.95 per hour. The company uses a standard variable overhead cost per unit of $1.45 per direct labor hour. Actualvariable factory overhead was $85,900. The company uses a standard fixed overhead cost per unit of $2.00 per direct labor hour at 55,000hours, which is 100% of normal capacity.Required:Prepare an income statement through gross profit for Alvarado Company for the month ended March 31. Assume Alvarado sold8,000 units at $250 per unit.

Income statement, balance sheet and cash flow statement are the three main financial statement…

Answered: Required: Prepare an income statement…

Required: Prepare an income statement through gross profit for Alvarado Company for the month ended March 31. Assume Alvarado sold 8,000 units at $250 per unit.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: The following data was extracted from the records of Today Company: 600 units at $55 per unit 50…

A: Gross Profit = Sales - Cost of Goods soldIn case of LIFO method units purchased last will be sold…

Q: Presented here is the income statement for Fairchild Co. for March: Sales $ 81,500 Cost…

A: A contribution margin income statement subtracts all variable expenses from sales to calculate the…

Q: The condensed product-line income statement for Northern Lights Company for the month of August is…

A: First, we need to calculate the variable costs for the Socks product line. Variable costs are the…

Q: Harris Company manufactures and sells a single product. A partially completed schedule of the…

A: Formula: Variable cost per unit = Total Variable cost / Number of units produced ParticularsTotal…

Q: The following income statement was drawn from the records of Stuart, a merchandising firm:…

A: The income statement, one of the most crucial financial statements for a firm, shows the profit and…

Q: The following income statement was drawn from the records of Franklin Company, a merchandising firm:…

A: The income statement includes all the revenue and expenses. The resulting amount after deducting…

Q: Company A had the following transactions during the month of January: Sales revenue: $50,000…

A: A company's net income, sometimes referred to as net profit or net earnings, is a crucial financial…

Q: Refer to the information for Jasper Company on the previous page.Required:1. Prepare an income…

A: The income statement would be one of three primary financial statements used only to reflect a…

Q: The Central Valley Company is a manufacturing firm that produces and sells a single product. The…

A: The break even sales are the sales where business earns no profit no loss during the period. The…

Q: Direct labour Sales Selling expenses Raw (direct) materials on hand: January 1 December 31 General…

A: Cost of goods manufactured - The cost of goods manufactured is calculated as follows - Total…

Q: MUNOZ COMPANY Income Statement For the Year Ended December 31 Sales revenue (6,500 units x $164)…

A: Variable costs are those costs which changes with change in level of activity. Fixed costs are costs…

Q: The condensed product-line income statement for Rhinebeck Company for the month of October is as…

A: Solution:-a Preparation of a differential analysis dated October 31 to determine if Mufflers should…

Q: Blossom Inc. had sales of $2,250,000 for the first quarter of 2022 (it sold 225,000 units). In…

A: Cost Volume Profit (CVP) Analysis: It implies to an analysis performed by the business to determine…

Q: At the end of January, Higgins Data Systems had an inventory of 710 units, which cost $15 per unit…

A: LIFOLIFO stands for last in, first out. LIFO is an inventory accounting method where it is assumed…

Q: Shown below are information provided by the bookkeeper of Luna Corporation: A. Sales for the month…

A: The FIFO stands for First In First Out. Under FIFO method, the older units are sold first and newer…

Q: Cavy Company completed 7,770 units during the year at a cost of $590,520. The beginning finished…

A: solution given Number of completed unit 7770 Cost incurred $590520 Opening inventory…

Q: Prepare a traditional format income statement for the next quarter. Milden Company…

A: Income Statement shows all incomes and expenses in the business and at the end it shows net income…

Q: Blossom Manufacturing Ltd. had sales for January 2022 of $1,025,000. The units sold were 20,500, and…

A: Variable costs are those type of costs which changes along with change in sales activity level.…

Q: Jacob’s Landing Inc. has sales of 2,000 for the first quarter of 2019. The company incurred the…

A: Through CVP analysis, the corporation studies the income statement with the cost prospective where…

Q: The cost of goods sold for Michaels Manufacturing in the current year was $233,000. The January 1…

A: The cost of goods manufactured during the period was $225,600

Q: Harrison Industries began July with a finished goods inventory of $52,000. The finished goods…

A: COST OF GOODS MANUFACTURED Cost of goods manufactured Include cost of Raw material Used During…

Q: Evansville Company had the following transactions for the month. Number Cost of Units per Unit…

A: The inventory valuation method used to evaluate the closing inventory and cost of goods sold on the…

Q: Flint’s Fabrics sold merchandise for $185000 cash during the month of July. Returns that month…

A: Formula: Net Sales = Total sales - sales returns. Deduction of sales returns from total sales…

Q: Cost of Goods Sold, Profit margin, and Net Income for a Manufacturing Company The following…

A: The Cost of goods sold refers to the cost of merchandise that is sold. The gross profit is defined…

Q: h) During January, 50 units costing $25 per unit were sold on account for selling price of $35 per…

A: The journal entries are prepared to keep the record of day to day transactions of the business.

Q: Chili Manufacturing Company Income Statement Month Ended June 30, 2018 Net Sales Revenue Cost of…

A: The following computations are done for Chili Manufacturing Company.

Q: Citron Ltd. is a manufacturing firm that produces and sells a single product. The company's revenues…

A: High Low Method - This method is used to segregate the variable and fixed cost. This method is…

Q: Tiny's Toys has the following financial information for the month of July available: Revenues…

A: The phrase "cost of goods sold" refers to the direct costs a business incurs when producing the…

Q: The following information is available for Crouching Alligator Manufacturing Company for the month…

A: The answer is as fallows

Q: CAMPBELL COMPANY Income Statement For the Year Ended December 31, Year 1 ales revenue (7,eee units x…

A: The income statement gives important information about a company's capacity to produce profits,…

Q: The following income statement was drawn from the records of Walton Company, a merchandising firm:…

A: Sales are reduced by a number of expenses to get a net income. ⁤These consist of selling costs,…

Q: The following information is about ABC Inc. during month of July: - Raw material purchases at cost…

A: The following information is about ABC Inc. during month of July: - Raw material purchases at cost…

Q: Consider the following data: Sales -- P 100,000; Gross Profit rate based on sales -- 30%; Goods…

A: Ending Finished goods = Goods Available for Sale - Cost of goods sold where, Cost of goods sold =…

Q: In its first month of operations, Lily Company made three purchases of merchandise in the following…

A: Average cost method :— Under Thai method, average cost per unit is used for output or sales units.…

Q: Morrisey & Brown, Limited, is the sole distributor of a product with growing sales. Its income…

A: High Low Method - This method is used to segregate the variable and fixed cost. This method is…

Q: Cost of Goods Sold, Profit margin, and Net Income for a Manufacturing Company The following…

A: Cost of goods sold = Cost of goods manufactured + Beginning Finished goods - Ending Finished goods…

Q: The owner of a large machine shop has just finished its financial analysis from the prior fiscal…

A: Interpretation:The machine shop has an inventory turnover ratio of 2.8. This means they sell and…

Q: Ferris Company began January with 4,000 units of its principal product. The cost of each unit is $8.…

A: The inventory can be valued using various methods as LIFO, FIFO and weighted average method.

Q: DeForest Company had the following transactions for the month. Sales for the month are $85 per unit.…

A: The inventory valuation method is used to evaluate the closing inventory and cost of goods sold…

Q: Sellall Department Stores reported the following amounts as of its December 31 year-end:…

A: The gross profit is calculated as difference between sales and cost of goods sold. The gross profit…

Q: At the end of January, Mineral Labs had an inventory of 905 units, which cost $13 per unit to…

A: Under the LIFO method, the inventory which has been purchased most recently is sold first and under…

Q: The information provided below was taken from the books of Uli Enterprise for the financial year…

A: Debtors Collection Schedule:

Q: The following information is from ABC Company's general ledger for the month of September: Beginning…

A: The cost of goods manufactured is the sum of the total costs incurred by a company during a specific…

Question

Income statement with variances
Instructions
Income Statement
Instructions
Alvarado Company produces a product that requires 3.0 standard pounds per unit at a standard price of $6.00 per pound. The company
used 23,900 pounds to produce 8,000 units, which were purchased at $6.20 per pound. Each unit requires 7.5 standard direct labor hours
per unit at a standard hourly rate of $22.50 per hour. For the 8,000 units produced, 60,200 hours were needed and employees were paid
an hourly rate of $21.95 per hour. The company uses a standard variable overhead cost per unit of $1.45 per direct labor hour. Actual
variable factory overhead was $85,900. The company uses a standard fixed overhead cost per unit of $2.00 per direct labor hour at 55,000
hours, which is 100% of normal capacity.
Required:
Prepare an income statement through gross profit for Alvarado Company for the month ended March 31. Assume Alvarado sold
8,000 units at $250 per unit.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1: Explain financial statement

VIEW

Step 2: Calculate cost of goods sold at standard

VIEW

Step 3: Calculate variances

VIEW

Solution

VIEW

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Financial Reporting in Hyperinflationary Economies

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Required information [The following information applies to the questions displayed below.] Use the following selected account balances of Delray Manufacturing for the year ended December 31. Sales Raw materials inventory, beginning Work in process inventory, beginning Finished goods inventory, beginning Raw materials purchases. Direct labor Indirect labor Repairs-Factory equipment Rent cost of factory building Selling expenses General and administrative expenses Raw materials inventory, ending Work in process inventory, ending Finished goods inventory, ending $ 2,700,000 112,000 146,000 190,000 515,000 618,000. 93,000 74,000 148,000 237,000 379,000 134,000 175,000 228,000 Prepare an income statement for Delray Manufacturing (a manufacturer). Assume that its cost of goods manufactured is $1,397,00
Want the Correct answer
In September, Company had sales of $273,000, selling expenses of $26,000, and administrative expenses of $47,000. The cost of goods manufactured was $183,000. The beginning balance in the finished goods inventory account was $45,000 and the ending balance was $34,000.Prepare an Income Statement in good form for September.
11. The following information is available for Bandera Manufacturing Company for the month ending January 31: Cost of goods manufactured $229,440 Selling expenses 76,640 Administrative expenses 40,520 Sales 488,160 Finished goods inventory, January 1 55,160 Finished goods inventory, January 31 50,280 For the month ended January 31, determine Bandera's (a) cost of goods sold, (b) gross profit, and (c) net income.
At the end of January, Mineral Labs had an inventory of 855 units, which cost $8 per unit to produce. During February the company produced 1,300 units at a cost of $12 per unit. a. If the firm sold 1,650 units in February, what was the cost of goods sold? (Assume LIFO inventory accounting.) Cost of goods sold b. If the firm sold 1,650 units in February, what was the cost of goods sold? (Assume FIFO inventory accounting.) Cost of goods sold
Cost of Goods Sold, Profit margin, and Net Income for a Manufacturing Company The following information is available for Bandera Manufacturing Company for the month ending January 31: Cost of goods manufactured $148,080 Selling expenses 49,470 Administrative expenses 26,150 Sales 315,070 Finished goods inventory, January 1 35,600 Finished goods inventory, January 31 32,450 For the month ended January 31, determine Bandera's (a) cost of goods sold, (b) gross profit, and (c) net income. (a) Bandera Manufacturing Company Cost of Goods Sold January 31 Sales $fill in the blank b71124ffbf90fa3_2 Gross profit fill in the blank b71124ffbf90fa3_4 $fill in the blank b71124ffbf90fa3_6 fill in the blank b71124ffbf90fa3_8 $fill in the blank b71124ffbf90fa3_10 (b) Bandera Manufacturing Company Gross Profit January 31 $fill in the blank abf993ffc04afc7_2 fill in the blank abf993ffc04afc7_4 $fill in the blank…
In its first month of operations, Sheffield Corp. made three purchases of merchandise in the following sequence: (1) 350 units at $8, (2) 400 units at $9, and (3) 500 units at $10. Calculate average unit cost. (Round answer to 3 decimal places, e.g. 5.125.) Average unit cost $___________________
In its first month of operations, Tamarisk, Inc. made three purchases of merchandise in the following sequence: (1) 165 units at $8, (2) 470 units at $9, and (3) 135 units at $10. (a1) Calculate the weighted-average unit cost. (Round answer to 3 decimal places, e.g. 15.225.
Harris Company manufactures and sells a single product. A partially completed schedule of the company's total costs and costs per unit over the relevant range of 65,000 to 105,000 units is given below: Required: 1. Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. 2. Assume that the company produces and sells 95,000 units during the year at a selling price of $9.36 per unit. Prepare a contribution format income statement for the year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. (Round the per unit variable cost and fixed cost to 2 decimal places.) Total cost Variable cost Fixed cost Total cost Cost per unit: Variable cost Fixed cost Total cost per unit $ $ $ 65,000 Units Produced and Sold 85,000 214,500 430,000 644,500 $ 0.00 $ 43,000 43,000 $ 0.00 $ 105,000 43,000 43,000 0.00
The following information is derived from Fun & Game LLC financial statements. Annual usage of material is 1,000 units, average stock level is 1,400 units, re-order period is 6 – 10 weeks, minimum level is 800 units and normal rate of consumption is 150 units per week. Then calculate the re-order quantity. a. 800 units b. 1,200 units c. 1,000 units d. 400 units
The following is the year ended data for Tiger Company: Sales Revenue $58,000 Cost of Goods Manufactured 21,000 Beginning Finished Goods Inventory 1,100 Ending Finished Goods Inventory 2,200 Selling Expenses 15,000 Administrative Expenses 3,900 What is the gross profit? A. $22,100 B. $38,100 C. $19,200 D.
In April, Holderness Incorporated, a merchandising company, had sales of $286,000, selling expenses of $20,500, and administrative expenses of $31,500. The cost of merchandise purchased during the month was $168,000. The beginning balance in the merchandise inventory account was $40,500 and the ending balance was $54,500 Required: Prepare a traditional format income statement for April. Holderness Incorporated For the month of April Traditional Format Income Statement Sales Cost of goods sold Gross margin Selling and administrative expenses Selling expense Administrative expense $ 20,500 31,500 5 286.000 154.000 132.000 52.000 $ 80,000 4