Swift Co. produces footballs. It incurred the following costs this year:Direct materials$40,000Direct labor31,00022,000Fixed manufacturing overhead38,000Variable manufacturing overhead23,000Fixed selling and administrative expenses14,000Variable selling and administrative expensesWhat are the total product costs for the company under absorption costing?Total product costs under absorption costing

Absorption costing: Absorption costing is used to compute cost of a product. Under this method total…

Answered: Swift Co. produces footballs. It…

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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Required Information [The following information applies to the questions displayed below.] Ramort Company reports the following for its single product. Ramort produced and sold 20,000 units this year. Direct materials Direct labor Variable overhead Fixed overhead Variable selling and administrative expenses Fixed selling and administrative expenses Sales price Compute gross profit under absorption costing. RAMORT COMPANY Gross Profit (Absorption Costing) Sales Cost of goods sold Gross profit 1,200,000 $10 per unit $ 12 per unit $3 per unit $ 40,000 per year $ 2 per unit $ 65,200 per year $ 60 per unit
Tiara Corporation manufactures and sells scarfs. Price and cost data for the company are provided below:Selling price per unit$50Variable costs per unitManufacturing costsDirect material15Direct labour8Variable manufacturing overhead12Variable selling and administrative costs3Annual fixed costsFixed manufacturing overhead$2,640,000Fixed selling and administrative costs$1,560,000Forecasted annual sales (units)500,000Required:(a)What is Tiara Corporation’s break-even point in dollars? (b)How many units would Tiara Corporation have to sell in order to earn a before tax profit of $480,000? (c)What is the company’s margin of safety (in dollars)?(d)If the company’s direct material costs increase by 20 percent and the fixed selling and administrative costs decrease by 20 percent, how many units will the company have to sell next year to reach its break-even point
Dhapa
Hi-Tek Manufacturing, Inc., makes two types of industrial component parts-the B300 and the T500. An absorption costing income statement for the most recent period is shown: Hi-Tek Manufacturing Inc. Income Statement Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating loss Direct materials Direct labor $1,778,500 1,254,584 Hi-Tek produced and sold 60,500 units of B300 at a price of $21 per unit and 12,700 units of T500 at a price of $40 per unit. The company's traditional cost system allocates manufacturing overhead to products using a plantwide overhead rate and direct labor dollars as the allocation base. Additional information relating to the company's two product lines is shown below: Manufacturing overhead Cost of goods sold 523,916 610,000 $ (86,084) 8300 T500 $ 400,700 $ 162,300 $ $ 120,100 $ 42,600 Total 563,000 162,700 528,884 $1,254,584 The company has created an activity-based costing system to evaluate the profitability of its products.…
Meman
Hi-Tek Manufacturing, Incorporated, makes two industrial component parts-B300 and T500. An absorption costing income statement for the most recent period is shown below: Hi-Tek Manufacturing, Incorporated Income Statement Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating loss Hi-Tek produced and sold 60,500 units of B300 at a price of $21 per unit and 12,500 units of T500 at a price of $39 per unit. The company's traditional cost system allocates manufacturing overhead to products using a plantwide overhead rate and direct labor dollars as the allocation base. Additional information relating to the company's two product lines is shown below: Direct materials Direct labor Manufacturing overhead Cost of goods sold $ 1,758,000 1,252,580 505,420 550,000 $ (44,580) B300 $ 400,700 $ 120,900 Activity Cost Pool (and Activity Measure) Machining (machine-hours) Setups (setup hours) Product-sustaining (number of products) Other (organization-sustaining costs)…
Under absorption costing, a company had the following per unit costs when 10,000 units were produced. Direct labor $ 3.80 Direct materials 4.80 Variable overhead 5.80 Total variable cost 14.40 8.60 Fixed overhead ($86,000/10,000 units) Total product cost per unit $23.00 The company sells its product for $75.20 per unit. Due to new regulations, the company must now incur $3.80 per unit of hazardous waste disposal costs and $4,630 per year of fixed hazardous waste disposal costs. Compute the company's break-even point (in units), including hazardous waste disposal costs. Break-even point 1,486 units
Denger
ABC Apparels is a clothing retailer. Unit costs associated with one of its products, Product A, are as follows: Direct materials $ 70 Direct manufacturing labor 20 Variable manufacturing overhead 15 Fixed manufacturing overhead 32 Sales commissions (2% of sales) 5 Administrative salaries 16 Total $158 What are the inventoriable costs per unit associated with Product A? $137 $140 $143 $88
The following information was collected for the first year of manufacturing for Appliance Apps: Direct Materials per Unit $2.50 Direct Labor per Unit $1.50 Variable Manufacturing Overhead per Unit $0.25 Variable Selling and Administration Expenses $1.75 Units Produced 39,000 Units Sold 35,000 Sales Price $12 Fixed Manufacturing Expenses $117,000 Fixed Selling and Administration Expenses $20,000 Question Content Area Prepare an income statement under variable costing method. Appliance AppsIncome Statement $- Select - - Select - $- Select - - Select - $- Select - - Select - - Select - $- Select - Question Content Area Prepare a reconciliation to the income under the absorption method. Appliance AppsReconciliation $- Select - - Select - $- Select -
Hi-Tek Manufacturing, Incorporated, makes two types of industrial component parts-the B300 and the T500. An absorption costing income statement for the most recent period is shown: Hi-Tek Manufacturing Incorporated Income Statement Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating loss Hi-Tek produced and sold 60,400 units of B300 at a price of $20 per unit and 12,700 units of T500 at a price of $39 per unit. The company's traditional cost system allocates manufacturing overhead to products using a plantwide overhead rate and direct labor dollars as the allocation base. Additional information relating to the company's two product lines is shown below: Direct materials Direct labor Manufacturing overhead Cost of goods sold $ 1,703,300 1,236,624 466,676 560,000 $ (93,324) Activity Cost Pool (and Activity Measure) Machining (machine-hours) Setups (setup hours) Product-sustaining (number of products) Other (organization-sustaining costs) Total…
The Mullin Company manufactures several different products. Unit costs associated with Product 10 are as follows: Direct materials $92 32 Direct manufacturing labor Variable manufacturing overhead 12 32 26 Fixed manufacturing overhead Sales commissions (2% of sales) 71% Administrative salaries Total $200 What is the percentage of the total variable costs per unit associated with Product 10 with respect to total cost? 81% 68% 84%

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