%24ACES INC.Absorption Costing Income StatementSales312,000Less: Cost of goods soldFixed overhead costsVariable production costs120,000Cost of goods sold120,000Gross marginSelling general and administrative expensesFixed selling and administrative costs64,200Total selling general and administrative expenses64,200Net income (loss) Aces Inc., a manufacturer of tennis rackets, began operations this year. The company produced 5,000 rackets and sold 3,900. Eachracket was sold at a price of $80. Fixed overhead costs are $60,000, and fixed selling and administrative costs are $64,200. Thecompany also reports the following per unit costs for the year:$24.00Variable production costsVariable selling and administrative expenses$ 1.00

Name: %24ACES INC.Absorption Costing Income StatementSales312,000Less: Cost
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Description: %24ACES INC.Absorption Costing Income StatementSales312,000Less: Cost of goods soldFixed overhead costsVariable production costs120,000Cost of goods sold120,000Gross marginSelling general and administrative expensesFixed selling and administrative c

The question is based on the concept of Cost Accounting.

Answered: Sales Less: Cost of goods so Fixed…

Business

Accounting

Sales Less: Cost of goods so Fixed overhead cos Variable production Cost of goods sold Gross margin Selling general and ac Fixed selling and a Total selling general a Net income (loss)

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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Question 1 On the cost-volume-profit graph, the area between the total cost line and the sales line before the break-ever represents:
Variable costing income will be greater than absorption costing income when: a. Sales is greater than production. b. contribution pricing is applied c. Production is less than or equal to sales. d. Production is greater than sales
1. The difference between contribution margin and income from operations is ________. net income variable costs fixed costs None of these choices are correct. 2. The relationship between a company’s contribution margin and income from operations is measured by _____. contribution margin operating leverage margin of safety break-even point 3. The __________ is the relative distribution of sales among the products sold by a company. sales mix mixed cost product mix None of these choices are correct. 4. The unit selling price of the overall enterprise product equals the ________. average selling price of the products price of the highest-selling product in the mix sum of the unit selling prices of each product multiplied by its sales mix percentage price of the product having the lowest selling price
All of the following represents a cost-volume-profit relationship except: a. Total contribution margin + variable xpenses = variable expenses + fixed expenses profit b. Sales = totalexpe expenses + profit O cSales - variable senses + profit = fied expenses O d. Profit = totalcontri contribution margin- fixed expenses O e Sales - Variable expenses = fixed expenses + profit
The equation for total costs (Y) is: Y = a+ bX In this equation, “a” represents: Net income Cost of goods sold Total fixed costs The level of activity (e.g., the number of units produced) Total variable costs Variable cost per unit of X Total revenue
Sunland Products manufactures and sells a variety of camping products. Recently the company opened a new factory to manufacture a deluxe portable cooking unit. Cost and sales data for the first month of operation are shown below: Beginning inventory Units produced Units sold Manufacturing costs Fixed overhead Variable overhead Direct labour Direct material Selling and administrative costs Fixed Variable 0 units 11,200 10,100 $100,800 $3 $12 $28 $207,100 per unit. per unit per unit $3 per unit sold The portable cooking unit sells for $110. Management is interested in the opening month's results and has asked for an income statement.
The _________ is considered part of the cost of the product in absorption costing, but not in variable costing. Group of answer choices Variable Overhead Fixed Overhead Variable Selling & Administrative Fixed Selling and Administrative In the absorption income statement, Sales less Cost of Goods Sold is the calculation for: Group of answer choices Contribution margin Gross margin Net Income Operating Income
Sales Variable costs Cost of goods sold Operating expenses Total variable Contribution margin Fixed costs Cost of goods sold Operating expenses Total fixed Net income (loss) Continue LA $ Eliminate LA Net Income Increase (Decrease)
A cost that has characteristics of both a variable cost and a fixed cost is called a Oa. variable/fixed cost Ob. sunk cost Oc. discretionary cost Od, mixed cost
An analyst is constructing a simple model to determine the gross and net profit of a product, given its profit per unit, quantity sold, and the total costs assigned to the product. The calculation for gross profit is Profit per Unit times Quantity. The calculation for Net Profit is Gross Profit minus Total Costs. A B 1. 2 Profit per Unit 8 3 Quantity |10,100 4 Gross Profit 5 6 Total Costs 6,100 7 8 Net Profit With the values for Profit per Unit, Quantity, and Total Costs shown above, what should the model return for the following calculated cells? Cell Value Gross Profit Net Profit
At break even point: a) sales - contribution margin = net income or net loss b) sales - fixed expenses = variable expenses c) sales + variable expenses = contribution margin d) contribution margin + fixed expenses = net income
Which of the following statements correctly complete the sentence:"Gross Margin equals":I. sales revenue less (minus) cost of goods sold.II. contribution margin less (minus) fixed costs.III. operating income plus all period costs.IV. sales revenue less (minus) cost of goods manufactured.