WITH THE FOLLOWING BACKGROUND PREPARE COSTING: - UNIT SELLING PRICES $10,000. - UNIT RAW MATERIAL $400. - SALARY OF 2 OPERATORS: THE FIRST ONE WITH A FIXED SALARY IN PRODUCTION FOR A MONTHLY VALUE OF $500.000. AND THE SECOND WITH A TOTAL VARIABLE SALARY OF $45 PER UNIT PRODUCED. - THE PRODUCTION SUPERVISOR HAS A VARIABLE MONTHLY SALARY OF $10,000 PER UNIT OF ARTICLE PRODUCED. - A FIXED SALARY IN ADMINISTRATION OF $500,000 PER MONTH. - VARIABLE SALES SALARIES ARE 3% OF SALES. - THERE ARE PRODUCTION MACHINERY DEPRECIATION COSTS OF $20 PER UNIT PRODUCED. - THE COST OF LEASING THE PRODUCTION CENTER IS $100- PER KILO PRODUCED. - PRODUCTION UNITS ARE 20,000 UNITS. - 15,000 UNITS ARE SOLD, IT IS REQUESTED: 1. ABSORPTIVE OR TRADITIONAL METHOD COSTING. 2. DIRECT OR VARIABLE METHOD COSTING.
WITH THE FOLLOWING BACKGROUND PREPARE COSTING: - UNIT SELLING PRICES $10,000. - UNIT RAW MATERIAL $400. - SALARY OF 2 OPERATORS: THE FIRST ONE WITH A FIXED SALARY IN PRODUCTION FOR A MONTHLY VALUE OF $500.000. AND THE SECOND WITH A TOTAL VARIABLE SALARY OF $45 PER UNIT PRODUCED. - THE PRODUCTION SUPERVISOR HAS A VARIABLE MONTHLY SALARY OF $10,000 PER UNIT OF ARTICLE PRODUCED. - A FIXED SALARY IN ADMINISTRATION OF $500,000 PER MONTH. - VARIABLE SALES SALARIES ARE 3% OF SALES. - THERE ARE PRODUCTION MACHINERY DEPRECIATION COSTS OF $20 PER UNIT PRODUCED. - THE COST OF LEASING THE PRODUCTION CENTER IS $100- PER KILO PRODUCED. - PRODUCTION UNITS ARE 20,000 UNITS. - 15,000 UNITS ARE SOLD, IT IS REQUESTED: 1. ABSORPTIVE OR TRADITIONAL METHOD COSTING. 2. DIRECT OR VARIABLE METHOD COSTING.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
WITH THE FOLLOWING BACKGROUND PREPARE COSTING:
- UNIT SELLING PRICES $10,000.
- UNIT RAW MATERIAL $400.
- SALARY OF 2 OPERATORS: THE FIRST ONE WITH A FIXED SALARY IN PRODUCTION FOR A MONTHLY VALUE OF $500.000. AND THE SECOND WITH A TOTAL VARIABLE SALARY OF $45 PER UNIT PRODUCED.
- THE PRODUCTION SUPERVISOR HAS A VARIABLE MONTHLY SALARY OF $10,000 PER UNIT OF ARTICLE PRODUCED.
- A FIXED SALARY IN ADMINISTRATION OF $500,000 PER MONTH.
- VARIABLE SALES SALARIES ARE 3% OF SALES.
- THERE ARE PRODUCTION MACHINERY DEPRECIATION COSTS OF $20 PER UNIT PRODUCED.
- THE COST OF LEASING THE PRODUCTION CENTER IS $100- PER KILO PRODUCED.
- PRODUCTION UNITS ARE 20,000 UNITS.
- 15,000 UNITS ARE SOLD,
IT IS REQUESTED:
1. ABSORPTIVE OR TRADITIONAL METHOD COSTING.
2. DIRECT OR VARIABLE METHOD COSTING.
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