Using variable costing, what is the unit product cost for both years? 2. What is the variable costing net operating income in Year 1 and in Year 2? 3. Reconcile the absorption costing and the variable costing net operating income figures for each year.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Using variable costing, what is the unit product cost for both years?

2. What is the variable costing net operating income in Year 1 and in Year 2?

3. Reconcile the absorption costing and the variable costing net operating income figures for each year.

Required 1
Required 2
Required 3
What is the variable costing net operating income in Year 1 and in Year 2? (Loss amounts should be indicated with a minus
sign.)
Year 1
Year 2
Net operating income (loss)
< Required 1
Required 3 >
Required 1
Required 2
Required 3
Reconcile the absorption costing and the variable costing net operating income figures for each year.
Reconciliation of Variable Costing and Absorption Costing Net Operating Incomes
Year 1
Year 2
Variable costing net operating income (loss)
Absorption costing net operating income
< Required 2
Required 3
Transcribed Image Text:Required 1 Required 2 Required 3 What is the variable costing net operating income in Year 1 and in Year 2? (Loss amounts should be indicated with a minus sign.) Year 1 Year 2 Net operating income (loss) < Required 1 Required 3 > Required 1 Required 2 Required 3 Reconcile the absorption costing and the variable costing net operating income figures for each year. Reconciliation of Variable Costing and Absorption Costing Net Operating Incomes Year 1 Year 2 Variable costing net operating income (loss) Absorption costing net operating income < Required 2 Required 3
During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows:
Sales (e S60 per unit)
Cost of goods sold (e $39 per unit)
Gross margin
Selling and administrative expenses
Year 1
960, 800
624, 000
336,000
301,000
Year 2
$ 1,560,000
1,014,000
546,000
331,000
215,000
Net operating incone
35,000
$3 per unit variable; $253,000 fixed each year.
The company's $39 unit product cost is computed as follows:
Direct naterials
Direct labor
Variable manufacturing overhead
Fixed manufacturing overhead ($399,000 + 21,800 units)
19
Absorption costine unit product cost
39
Production and cost data for the first two years of operations are:
Year 1
Year 2
Units produced
Units sold
21,e00
16,000
21,000
26,000
Required:
1. Using variable costing, what is the unit product cost for both years?
2. What is the variable costing net operating income in Year 1 and in Year 2?
3. Reconcile the absorption costing and the varlable costing net operating Income figures for each year.
Complete this question by entering your answers in the tabs below.
Required 1
Required 2
Required 3
Using variable costing, what is the unit product cost for both years?
Unit product cost
Required 1
Required 2 >
Transcribed Image Text:During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows: Sales (e S60 per unit) Cost of goods sold (e $39 per unit) Gross margin Selling and administrative expenses Year 1 960, 800 624, 000 336,000 301,000 Year 2 $ 1,560,000 1,014,000 546,000 331,000 215,000 Net operating incone 35,000 $3 per unit variable; $253,000 fixed each year. The company's $39 unit product cost is computed as follows: Direct naterials Direct labor Variable manufacturing overhead Fixed manufacturing overhead ($399,000 + 21,800 units) 19 Absorption costine unit product cost 39 Production and cost data for the first two years of operations are: Year 1 Year 2 Units produced Units sold 21,e00 16,000 21,000 26,000 Required: 1. Using variable costing, what is the unit product cost for both years? 2. What is the variable costing net operating income in Year 1 and in Year 2? 3. Reconcile the absorption costing and the varlable costing net operating Income figures for each year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Using variable costing, what is the unit product cost for both years? Unit product cost Required 1 Required 2 >
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