Variable Costing Exercise PNT Company has been producing and selling pint containers for a number of years. The following information was gathered for 2016. Selling price per unit $15.50 Variable Cost per Unit: Manufacturing Selling & Admin $7.50 $3.00 Fixed Costs Manufacturing Selling & Admin $220,000 $145,000 Required: a. Prepare an income statement using the contribution approach for both scenarios b. Prepare an income statement using the absorption approach for both scenarios

Variable Costing Exercise PNT Company has been producing and selling pint containers for a number of years. The following information was gathered for 2016. Selling price per unit $15.50 Variable Cost per Unit: Manufacturing Selling & Admin $7.50 $3.00 Fixed Costs Manufacturing Selling & Admin $220,000 $145,000 Required: a. Prepare an income statement using the contribution approach for both scenarios b. Prepare an income statement using the absorption approach for both scenarios

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Variable Costs, Contribution Margin, Contribution Margin Ratio Super-Tees Company plans to sell 20,000 T-shirts at $19 each in the coming year. Product costs include: Direct materials per T-shirt $6.65 $1.33 Direct labor per T-shirt Variable overhead per T-shirt $0.57 Total fixed factory overhead $43,000 Variable selling expense is the redemption of a coupon, which averages $0.95 per T-shirt; fixed selling and administrative expenses total $13,000.
Rings company has three product lines A, B and C. The following financial information is available:
s
1. Shown below is an income statement in the traditional format for Ellie Inc, which has a contribution margin ratio of 25%. Sales ...... Cost of goods sold... Gross profit...... Operating expenses: Selling... Administrative.... Operating income $100,000 (70,000) $ 30,000 (5,000) (10,000) $ 15,000 Prepare an income statement in the contribution margin format. b. Calculate the sales per unit, variable expense per unit, and contribution margin per unit if 10,000 units were produced and sold. c. Calculate the cost formula (Y=a+bX). d. Calculate the firm's break even point in units.
Manji