Shalom Company manufactures50,000 units of a product and sells40,000 units. Total manufacturing costper unit is P50 (variable manufacturingcost, P10; fixed manufacturing cost,P40). Assuming no beginninginventory, what is the effect on netincome if absorption costing is usedinstead of variable costing?net income is P200,000 highernet income is P400,000 highernet income is the samenet income is P400,000 lower

Under absorption costing, cost of goods sold includes the variable manufacturing cost as well as…

Answered: Shalom Company manufactures 50,000…

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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The Southern Corporation manufactures a single product and has the following cost structure: Variable costs per unit: Production $ 33 Selling and administrative $ 16 Fixed costs per year: Production $ 130,830 Selling and administrative $ 107,280 Last year, 6,230 units were produced and 6,030 units were sold. There was no beginning inventory. The carrying value on the balance sheet of the ending inventory of finished goods under variable costing would be:
4. Under 100% sales assumption using absorption costing, the ending inventory balance is 5. Under 75% sale assumption, using absorption costing, the ending inventory balance is? 6. Under 75% sale assumption, using variable costing, the ending inventory balance is?
Vinubhai
Garrett Company provided the following information: Common fixed cost totaled $46,000. Garrett allocates common fixed cost to Product 1and Product 2 on the basis of sales. If Product 2 is dropped, which of the following is true?a. Sales will increase by $300,000.b. Overall operating income will increase by $2,600.c. Overall operating income will decrease by $25,000.d. Overall operating income will not change.e. Common fixed cost will decrease by $27,600.
Atlantic Company sells a product with a break-even point of 6,148 sales units. The variable cost is $71 per unit, and fixed costs are $178,292. Determine the following:
solve this one
2. Maple Enterprises sells a single product with a selling price of $75 and variable costs per unit of $30. The company’s monthly fixed expenses are $22,500. The following names are to be considered when completing this problem: Operating Income Variable Costs Sales Fixed Costs per Unit Selling Price per Unit Variable Cost per Unit Contribution Margin Fixed Costs Operating Loss What is the company’s break-even point in units? . Use commas as needed (i.e. 1,234). What is the company’s break-even point in dollars? . Rounded to whole dollars and shown with "$" and commas as needed (i.e. $12,345). Using the names listed above, construct a contribution margin income statement for the month of September when they will sell 900 units. Rounded to whole dollars and shown with "$" and commas as needed (i.e. $12,345). Maple Enterprises Contribution Margin Income Statement For the Month of September How many units will Maple need to sell in…
jagdish
Pau, Inc., which has fixed costs of $88,333, sells two products whose sales price, variable cost per unit, and percentage of sales units are presented in the table below. Product A Product B $ 22 $ 9 40 % Sales Price $ $ 17 Variable Cost Sales Mix 60% How many units of Product B must Pau sell to break even Do not round intermediate calculations. Round your final answer to the nearest whole number.

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