1. In presenting inventory on balance sheet December 31, 2021, the unit cost under absorption costing is?2. What is the net income for 2021 under variable costing? Sam Company began its operations on January 1, 20201 and produces asingle product that sells for P7 per unit. Standard capacity is 100,000 unitsper year. 100,000 units were produced and 80,000 units were sold in 2021.Manufacturing costs and selling and administrative expenses were as follows:Fixed costsVariable costsDirect materialsDirect laborFactory overheadSelling and administrativeP 1.50 per unit produced1.00 per unit produced0.50 per unit produced0.50 per unit soldP150,00080,000There were no variances from the standard variable costs. Any under or over-appliedoverhead is written off directly at year-end as an adjustment to the cost of goods sold.

The income statement can be prepared using various methods as variable costing and absorption…

Answered: Sam Company began its operations on…

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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1. In presenting inventory on balance sheet December 31, 2021, the unit cost under absorption costing is?

2. What is the net income for 2021 under variable costing?

Sam Company began its operations on January 1, 20201 and produces a
single product that sells for P7 per unit. Standard capacity is 100,000 units
per year. 100,000 units were produced and 80,000 units were sold in 2021.
Manufacturing costs and selling and administrative expenses were as follows:
Fixed costs
Variable costs
Direct materials
Direct labor
Factory overhead
Selling and administrative
P 1.50 per unit produced
1.00 per unit produced
0.50 per unit produced
0.50 per unit sold
P150,000
80,000
There were no variances from the standard variable costs. Any under or over-applied
overhead is written off directly at year-end as an adjustment to the cost of goods sold.

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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