Variable costing method: The method of costing where only variable costs are charged to the products is called as variable costing. The fixed overheads are charged to the units which are sold. Requirement 1: Calculate the product cost per unit using the variable costing method.

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Answer 1

Question

Chapter 4, Problem 4.14E

To determine

Concept introduction:

Variable costing method:

The method of costing where only variable costs are charged to the products is called as variable costing. The fixed overheads are charged to the units which are sold.

Requirement 1:

Calculate the product cost per unit using the variable costing method.

To determine

Concept introduction:

Income statement:

The income statement tells about the revenues earned and expenses incurred by the company in a specific period of time. It is also known as operations statement, earnings statement, revenue statement or profit, and loss statement.

Requirement 2:

Prepare the contribution format income statement using the variable costing method.

To determine

Concept introduction:

Break-even point (BEP):

Break-Even point or BEP is the level of output at which the total sales is equal to the total cost. The BEP means there are no operating income and no operating losses. It is a very important management tool as the management use this point as the minimum sales required for business survival.

Requirement 3:

Calculate the BEP in terms of the unit for Company C.

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Activity Based Costing - practice problem Fontillas Instrument, Inc. manufactures two products: missile range instruments and space pressure gauges. During April, 50 range instruments and 300 pressure gauges were produced, and overhead costs of $89,500 were estimated. An analysis of estimated overhead costs reveals the following activities. Activities 1. Materials handling 2. Machine setups Cost Drivers Number of requisitions Number of setups Total cost $35,000 27,500 3. Quality inspections Number of inspections 27,000 $89.500 The cost driver volume for each product was as follows: Cost Drivers Instruments Gauge Total Number of requisitions 400 600 1,000 Number of setups 200 300 500 Number of inspections 200 400 600 Insructions (a) Determine the overhead rate for each activity. (b) Assign the manufacturing overhead costs for April to the two products using activity-based costing.

Bodhi Company has three cost pools and two doggie products (leashes and collars). The activity cost pool of ordering has the cost drive of purchase orders. The activity cost pool of assembly has a cost driver of parts. The activity cost pool of supervising has the cost driver of labor hours. The accumulated data relative to those cost drivers is as follows: Expected Use of Estimated Cost Drivers by Product Cost Drivers Overhead Leashes Collars Purchase orders $260,000 70,000 60,000 Parts 400,000 300,000 500,000 Labor hours 300,000 15,000 10,000 $960,000 Instructions: (a) Compute the activity-based overhead rates. (b) Compute the costs assigned to leashes and collars for each activity cost pool. (c) Compute the total costs assigned to each product.

Answer 2

Question

Chapter 4, Problem 4.14E

To determine

Concept introduction:

Variable costing method:

The method of costing where only variable costs are charged to the products is called as variable costing. The fixed overheads are charged to the units which are sold.

Requirement 1:

Calculate the product cost per unit using the variable costing method.

To determine

Concept introduction:

Income statement:

The income statement tells about the revenues earned and expenses incurred by the company in a specific period of time. It is also known as operations statement, earnings statement, revenue statement or profit, and loss statement.

Requirement 2:

Prepare the contribution format income statement using the variable costing method.

To determine

Concept introduction:

Break-even point (BEP):

Break-Even point or BEP is the level of output at which the total sales is equal to the total cost. The BEP means there are no operating income and no operating losses. It is a very important management tool as the management use this point as the minimum sales required for business survival.

Requirement 3:

Calculate the BEP in terms of the unit for Company C.

Expert Solution & Answer

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See solution

Answer 3

Question

Chapter 4, Problem 4.14E

To determine

Concept introduction:

Variable costing method:

The method of costing where only variable costs are charged to the products is called as variable costing. The fixed overheads are charged to the units which are sold.

Requirement 1:

Calculate the product cost per unit using the variable costing method.

To determine

Concept introduction:

Income statement:

The income statement tells about the revenues earned and expenses incurred by the company in a specific period of time. It is also known as operations statement, earnings statement, revenue statement or profit, and loss statement.

Requirement 2:

Prepare the contribution format income statement using the variable costing method.

To determine

Concept introduction:

Break-even point (BEP):

Break-Even point or BEP is the level of output at which the total sales is equal to the total cost. The BEP means there are no operating income and no operating losses. It is a very important management tool as the management use this point as the minimum sales required for business survival.

Requirement 3:

Calculate the BEP in terms of the unit for Company C.

Expert Solution & Answer

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See solution

Answer 4

Question

Chapter 4, Problem 4.14E

To determine

Concept introduction:

Variable costing method:

The method of costing where only variable costs are charged to the products is called as variable costing. The fixed overheads are charged to the units which are sold.

Requirement 1:

Calculate the product cost per unit using the variable costing method.

To determine

Concept introduction:

Income statement:

The income statement tells about the revenues earned and expenses incurred by the company in a specific period of time. It is also known as operations statement, earnings statement, revenue statement or profit, and loss statement.

Requirement 2:

Prepare the contribution format income statement using the variable costing method.

To determine

Concept introduction:

Break-even point (BEP):

Break-Even point or BEP is the level of output at which the total sales is equal to the total cost. The BEP means there are no operating income and no operating losses. It is a very important management tool as the management use this point as the minimum sales required for business survival.

Requirement 3:

Calculate the BEP in terms of the unit for Company C.

Expert Solution & Answer

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See solution

Answer 5

Chapter 4, Problem 4.14E

To determine

Concept introduction:

Variable costing method:

The method of costing where only variable costs are charged to the products is called as variable costing. The fixed overheads are charged to the units which are sold.

Requirement 1:

Calculate the product cost per unit using the variable costing method.

To determine

Concept introduction:

Income statement:

The income statement tells about the revenues earned and expenses incurred by the company in a specific period of time. It is also known as operations statement, earnings statement, revenue statement or profit, and loss statement.

Requirement 2:

Prepare the contribution format income statement using the variable costing method.

To determine

Concept introduction:

Break-even point (BEP):

Break-Even point or BEP is the level of output at which the total sales is equal to the total cost. The BEP means there are no operating income and no operating losses. It is a very important management tool as the management use this point as the minimum sales required for business survival.

Requirement 3:

Calculate the BEP in terms of the unit for Company C.

Answer 6

Chapter 4, Problem 4.14E

To determine

Concept introduction:

Variable costing method:

The method of costing where only variable costs are charged to the products is called as variable costing. The fixed overheads are charged to the units which are sold.

Requirement 1:

Calculate the product cost per unit using the variable costing method.

Answer 7

Chapter 4, Problem 4.14E

To determine

Concept introduction:

Variable costing method:

The method of costing where only variable costs are charged to the products is called as variable costing. The fixed overheads are charged to the units which are sold.

Requirement 1:

Calculate the product cost per unit using the variable costing method.

Answer 8

To determine

Concept introduction:

Income statement:

The income statement tells about the revenues earned and expenses incurred by the company in a specific period of time. It is also known as operations statement, earnings statement, revenue statement or profit, and loss statement.

Requirement 2:

Prepare the contribution format income statement using the variable costing method.

Answer 9

To determine

Concept introduction:

Income statement:

The income statement tells about the revenues earned and expenses incurred by the company in a specific period of time. It is also known as operations statement, earnings statement, revenue statement or profit, and loss statement.

Requirement 2:

Prepare the contribution format income statement using the variable costing method.

Answer 10

To determine

Concept introduction:

Break-even point (BEP):

Break-Even point or BEP is the level of output at which the total sales is equal to the total cost. The BEP means there are no operating income and no operating losses. It is a very important management tool as the management use this point as the minimum sales required for business survival.

Requirement 3:

Calculate the BEP in terms of the unit for Company C.

Answer 11

To determine

Concept introduction:

Break-even point (BEP):

Break-Even point or BEP is the level of output at which the total sales is equal to the total cost. The BEP means there are no operating income and no operating losses. It is a very important management tool as the management use this point as the minimum sales required for business survival.

Requirement 3:

Calculate the BEP in terms of the unit for Company C.

Answer 12

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Answer 13

Expert Solution & Answer

Answer 14

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Answer 15

Ch. 4 - Prob. 4.1Q Ch. 4 - Prob. 4.2Q Ch. 4 - Prob. 4.3Q Ch. 4 - Prob. 4.4Q Ch. 4 - Prob. 4.5Q Ch. 4 - Prob. 4.6Q Ch. 4 - Prob. 4.7Q Ch. 4 - Prob. 4.8Q Ch. 4 - Prob. 4.9Q Ch. 4 - Prob. 4.10Q

Variable costing method: The method of costing where only variable costs are charged to the products is called as variable costing. The fixed overheads are charged to the units which are sold. Requirement 1: Calculate the product cost per unit using the variable costing method.

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Chapter 4 Solutions