The vice president for Sales of Huber Corporation has received the income statement for November. The statement has been prepared on the variable costing basis and is reproduced below. The firm has just adopted a variable costing system for internal reporting purposes. The controller attached the following notes to the statements: The unit sales price for November averaged $24. The standard unit manufacturing costs for the month were Variable cost $12 Fixed OH cost 4 Total cost $16 The unit rate for fixed manufacturing costs is a predetermined rate based upon a normal monthly production of 150,000 units. Production for November was 45,000 units in excess of sales. The inventory at November 30 consisted of 80,000 units. Huber Corporation Income Statement For the Month of November ($000 omitted) Sales $ 2,400 Minus: Variable standard COGS (1,200) Manufacturing margin $ 1,200 Minus: Fixed manufacturing costs at budget $600 Fixed manufacturing cost budget variance 0 (600) Gross margin $ 600 Minus: Fixed selling and administrative costs (400) Net income before taxes $ 200 Question What is the actual unit fixed cost for units produced in November?
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
The vice president for Sales of Huber Corporation has received the income statement for November. The statement has been prepared on the variable costing basis and is reproduced below. The firm has just adopted a variable costing system for internal reporting purposes. The controller attached the following notes to the statements: The unit sales price for November averaged $24. The standard unit
Question What is the actual unit fixed cost for units produced in November?
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