The Palin Company manufactures several products. The Palin Company has gathered the following information for the year ended December 31, 2010: Sales Direct materials used $110,000 $20,800 Indirect production costs-fixed $10,400 Indirect production costs-variable $6,600 Direct labor-fixed $12,300 Direct labor-variable $22,300 Selling expenses-fixed $33,040 Selling expenses-variable $33,440 Finished goods inventory, January 1, 2010 $12,000 Finished goods inventory, December 31, 2010 $22,000 Work in process inventory, January 1, 2010 $0 Work in process inventory, December 31, 2010 $0 Requirements: A) Compute the Cost of Goods Manufactured for the year ended December 31, 2010. B) Compute the Cost of Goods Sold for the year ended December 31, 2010. C) Compute the Net Income (Loss) for the year ended December 31, 2010.

The Palin Company manufactures several products. The Palin Company has gathered the following information for the year ended December 31, 2010: Sales Direct materials used $110,000 $20,800 Indirect production costs-fixed $10,400 Indirect production costs-variable $6,600 Direct labor-fixed $12,300 Direct labor-variable $22,300 Selling expenses-fixed $33,040 Selling expenses-variable $33,440 Finished goods inventory, January 1, 2010 $12,000 Finished goods inventory, December 31, 2010 $22,000 Work in process inventory, January 1, 2010 $0 Work in process inventory, December 31, 2010 $0 Requirements: A) Compute the Cost of Goods Manufactured for the year ended December 31, 2010. B) Compute the Cost of Goods Sold for the year ended December 31, 2010. C) Compute the Net Income (Loss) for the year ended December 31, 2010.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter2: Basic Cost Management Concepts

Section: Chapter Questions

Problem 22E: Ellerson Company provided the following information for the last calendar year: During the year,...

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Subject: accounting
JART manufactures and sells underwater markers. Its contribution margin income statement follows. Contribution Margin Income Statement Per Unit $ 6.00 For Year Ended December 31 Sales (470,000 units) Variable costs Direct materials Direct labor Variable overhead Contribution margin Fixed costs Fixed overhead Fixed general and administrative Income 1.51 0.39 0.60 3.50 0.30 0.25 $ 2.95 Annual Total $ 2,820,000 709,700 183,300 282,000 1,645,000 Required: 1. Compute income from the special offer. 2. Should the company accept or reject the special offer? 141,000 117,500 $ 1,386,500 A potential customer offers to buy 57,000 units for $2.90 each. These sales would not affect the company's sales through its normal channels. Details about the special offer follow. Direct materials cost per unit and variable overhead cost per unit would not change. • Direct labor cost per unit would be $0.50 because the offer would require overtime pay. • Accepting the offer would require incremental fixed…
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JART manufactures and sells underwater markers. Its contribution margin income statement follows. Contribution Margin Income Statement For Year Ended December 31 Per Unit Annual Total Sales (420,000 units) $ 7.00 $ 2,940,000 Variable costs Direct materials 1.46 613,200 Direct labor 0.44 184,800 Variable overhead 0.70 294,000 Contribution margin 4.40 1,848,000 Fixed costs Fixed overhead 0.30 126,000 Fixed general and administrative 0.25 105,000 Income $ 3.85 $ 1,617,000 A potential customer offers to buy 52,000 units for $3.70 each. These sales would not affect the company’s sales through its normal channels. Details about the special offer follow. Direct materials cost per unit and variable overhead cost per unit would not change. Direct labor cost per unit would be $0.62 because the offer would require overtime pay. Accepting the offer would require incremental fixed general and administrative costs of $5,200. Accepting the offer would require no…
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