Units sold Units produced Fixed production costs Variable production costs per unit Selling price per unit Fixed selling and administrative expense 2020 4,400 4,400 $39,600 $82 $215 $410,000 2021 4,400 4,800 $39,600 $82 $215 $410,000 2022 4,400 13,200 4,000 13,200 $39,600 $82 $215 Total $410,000

Units sold Units produced Fixed production costs Variable production costs per unit Selling price per unit Fixed selling and administrative expense 2020 4,400 4,400 $39,600 $82 $215 $410,000 2021 4,400 4,800 $39,600 $82 $215 $410,000 2022 4,400 13,200 4,000 13,200 $39,600 $82 $215 Total $410,000

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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Question

Calculate profit and the value of ending inventory for each year using variable costing.
Net profit
Ending inventory
$
$
2020
2021
32800
$
2022
0

Units sold
Units produced
Fixed production costs
Variable production costs per unit
Selling price per unit
Fixed selling and administrative expense
2020
4,400
4,400
$39,600
$82
$215
$410,000
2021
4,400
4,800
$39,600
$82
$215
2022
4,400
$39,600
$82
$215
Total
4,000 13,200
$410,000 $410,000
13,200

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Step 1: Introduce to income statement

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Step 2: Working for sales revenue

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Step 3: Working for variable production costs under variable costing method

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Step 4: Working for net profit under variable costing

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Step 5: Working for ending inventory using variable costing method

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QUESTION 9 QRC Company is trying to decide which one of two alternatives it will accept. The costs and revenues associated with each alternative are listed below: Alternative A Alternative B Projected revenue $ 62,500 $ 75,000 Unit-level costs 12,500 18,000 Batch-level costs 6,250 12,000 Product-level costs 7,500 8,500 Facility-level costs 5,000 6,250 What is the differential revenue for this decision? $62,500 $25,000 $75,000 $12,500
PROBLEM 8. The Color Company manufactures and sells two products. The selling prices and variable costs of the products are as follows: Blujets Blupens Selling prices Variable costs P20 P40 8 24 The sales for 2021 were in the ratio of 3 Blujets to 1 Blupen. Sales volume for 2021 was P1 million. Fixed costs for 2020 amounted to P390,000. Requirements: 1. Compute the number of units sold in 2021 for each product. 2. Compute the breakeven sales in pesos and in units. 3. Compute the composite breakeven for the company.
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36
QUESTION 20 Total Per unit Sales Revenue (30,000 units) $750,000 $25 Variable Costs A $450,000 $15 Contribution Margin $300,000 Fixed Costs $150,000 Operating Income $150,000 Now assume that this company's selling price per unit and variable cost per unit stay the same while total fixed costs increases by $100,000 per year. This company's breakeven point will: O increase O decrease remain the same