Variable costs per unit: Manufacturing: Direct materials. Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses $ $ $ $ 25 15 6 2 $590,000 $150,000 During its first year of operations, O'Brien produced 92,000 units and sold 72,000 units. During its second year of operations, it produced 75,000 units and sold 90,000 units. In its third year, O'Brien produced 81,000 units and sold 76,000 units. The selling price of the company's product is $71 per unit.

Variable costs per unit: Manufacturing: Direct materials. Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses $ $ $ $ 25 15 6 2 $590,000 $150,000 During its first year of operations, O'Brien produced 92,000 units and sold 72,000 units. During its second year of operations, it produced 75,000 units and sold 90,000 units. In its third year, O'Brien produced 81,000 units and sold 76,000 units. The selling price of the company's product is $71 per unit.

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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Walsh Company manufactures and sells one product. The following information pertains to the company's first two years of operations: variable cost per unit manufacturing direct materials $30 direct labor $12 variable manufacturing overhead $5 variable selling and administrative $4; fixed costs per year, fixed manufacturing overhead $240,00 fixed selling and administrative expenses $60,000. During its first years of operations, Walsh produced 50,000 units and sold 40, 000 units. During its second year of operations, it produced 40,000 units and sold 50,000 units. The selling price of the company's product is $51 per unit. Assume the company uses variable costing. Prepare an income statement for Year 1 and 2. Assume that the company uses absorption costing. Compute the unit product cost for year 1 and 2. Assume the company uses absorption costing. Prepare an income statement for Year 1 and 2. Reconcile the difference between variable costing and absorption costing net operating income in…
O'Brien Company manufactures and sells one product. The following information pertains to each of the company's first three years of operations: Variable costs per unit: Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses Case 6-29 Part-1 (Algo) During its first year of operations, O'Brien produced 97,000 units and sold 73,000 units. During its second year of operations, it produced 76,000 units and sold 95,000 units. In its third year, O'Brien produced 88,000 units and sold 83,000 units. The selling price of the company's product is $74 per unit. a. Compute the unit product cost for Year 1, Year 2, and Year 3. b. Prepare an income statement for Year 1, Year 2, and Year 3. Required: 1. Assume the company uses variable costing and a FIFO inventory flow assumption (FIFO means first-in first-out; in other words, it assumes the oldest…
Diego Company manufactures one product that is sold for $72 per unit in two geographic regions-East and West. The following information pertains to the company's first year of operations in which it produced 55,000 units and sold 50,000 units. Variable costs per unit: Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expense $ 23 $ 14 $3 $5 $ 770,000 $ 607,000 The company sold 37,000 units in the East region and 13,000 units in the West region. It determined $290,000 of its fixed selling and administrative expense is traceable to the West region, $240,000 is traceable to the East region, and the remaining $77,000 is a common fixed expense. The company will continue to incur the total amount of its fixed manufacturing overhead costs as long as it continues to produce any amount of its only product. Net operating income. Net operating loss 11.…
Consider the following information for Presidio Inc.'s most recent year of operations. Number of units produced 2,800 1,700 Number of units sold Sales price per unit Direct materials per unit Direct labor per unit Variable manufacturing overhead per unit Fixed manufacturing overhead per unit ($331,240 + 2,800 units) Total variable selling expenses ($12 per unit sold) Total fixed general and administrative $ 670.00 50.00 80.00 30.00 118.30 20,400.00 78,000.00 expenses Required: 2-a. Complete a full absorption costing income statement for Presidio. Assume there was no beginning inventory. 2-b. Complete a variable costing income statement for Presidio. Assume there was no beginning inventory. 3. Compute the difference in profit between full absorption costing and variable costing. Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Req 2A Req 2B Req 3 Complete a full absorption costing income statement for Presidio. Assume there…
Lynch Company manufactures and sells a single product. The following costs were incurred during the company's first year of operations: Variable costs per unit: Manufacturing: Direct materials Direct labor $ 10 $4 Variable manufacturing overhead $2 Variable selling and administrative $2 Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative $ 374,000 $ 284,000 During the year, the company produced 34,000 units and sold 26,000 units. The selling price of the company's product is $44 per unit. b. Prepare an income statement for the year.
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O’Brien Company manufactures and sells one product. The following information pertains to each of the company’s first three years of operations: Variable costs per unit: Manufacturing: Direct materials $ 26 Direct labor $ 15 Variable manufacturing overhead $ 5 Variable selling and administrative $ 2 Fixed costs per year: Fixed manufacturing overhead $ 570,000 Fixed selling and administrative expenses $ 140,000 During its first year of operations, O’Brien produced 96,000 units and sold 77,000 units. During its second year of operations, it produced 85,000 units and sold 99,000 units. In its third year, O’Brien produced 87,000 units and sold 82,000 units. The selling price of the company’s product is $79 per unit. 4. Assume the company uses absorption costing and a LIFO inventory flow assumption (LIFO means last-in first-out. In other words, it assumes that the newest units in inventory are sold first): Compute the unit product cost for Year 1, Year 2, and…
Subject :- Accounting
Walsh Company manufactures and sells one product. The following information pertains to each of the company's first two years of operations: Variable costs per unit: Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses $ 29 $ 15 $ 6 $ 5 $ 320,000 $ 80,000 During its first year of operations, Walsh produced 50,000 units and sold 40,000 units. During its second year of operations, it produced 40,000 units and sold 50,000 units. The selling price of the company's product is $59 per unit. Required: 1. Assume the company uses variable costing: a. Compute the unit product cost for Year 1 and Year 2. b. Prepare an income statement for Year 1 and Year 2. 2. Assume the company uses absorption costing: a. Compute the unit product cost for Year 1 and Year 2. b. Prepare an income statement for Year 1 and Year 2. 3. Reconcile the difference between…
Required information [The following information applies to the questions displayed below.] O'Brien Company manufactures and sells one product. The following information pertains to each of the company's first three years of operations: Variable costs per unit: Manufacturing: $ Direct materials Direct labor $ $ Variable manufacturing overhead Variable selling and administrative $ Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses $560,000 $100,000 During its first year of operations, O'Brien produced 98,000 units and sold 75,000 units. During its second year of operations, it produced 80,000 units and sold 98,000 units. In its third year, O'Brien produced 90,000 units and sold 85,000 units. The selling price of the company's product is $74 per unit. 2. Assume the company uses variable costing and a LIFO inventory flow assumption (LIFO means last-in first-out. In other words, it assumes that the newest units in inventory are sold first): a.…
Required information [The following information applies to the questions displayed below.] Diego Company manufactures one product that is sold for $73 per unit in two geographic regions-the East and West regions. The following information pertains to the company's first year of operations in which it produced 44,000 units and sold 39,000 units. Variable costs per unit: Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expense a. What is the company's break-even point in unit sales? The company sold 29,000 units in the East region and 10,000 units in the West region. It determined that $180,000 of its fixed selling and administrative expense is traceable to the West region, $130,000 is traceable to the East region, and the remaining $90,000 is a common fixed expense. The company will continue to incur the total amount of its fixed…