Questions 2&3

1. During the first month of operations ended January 31, Wardner Apparel produced 80,000 designer cowboy hats, of which 72,000 were sold. Operating data for the month are summarized as follows: Sales Category Manufacturing Costs: Direct Materials Direct Labor Variable Manufacturing Costs Fixed Manufacturing Costs Total Manufacturing Costs Sales Selling and Admin Expenses: Variable Fixed Total Selling and Admin Expenses Category Manufacturing Costs: Direct Materials Direct Labor Variable Manufacturing Costs Fixed Manufacturing Costs Total Manufacturing Costs Dollar Amount During February, Wardner Apparel produced 64,000 designer cowboy hats and sold 72,000 cowboy hats. Operating data for February are summarized as follows: Selling and Admin Expenses: Variable Fixed Total Selling and Admin Expenses $1,500,000 1,480,000 220,000 420,000 144,000 35,000 Dollar Amount 1,350,000 1,200,000 190,000 420,000 Subtotals/Totals 144,000 35,000 $4,560,000 3,620,000 179,000 Subtotals/Totals $4,560,000…

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Summarized data for Walrus Co. for its first year of operations are: A. Prepare an income statement under absorption costing B. Prepare an income statement under variable costing

Refer to Cornerstone Exercise 18.3. Required: 1. Calculate the cost of each unit using variable costing. 2. How many units remain in ending inventory? What is the cost of ending inventory using variable costing? 3. Prepare a variable-costing income statement for Pattison Products, Inc., for the month of October. 4. What if November production was 40,000 units, costs were stable, and sales were 41,000 units? What is the cost of ending inventory? What is operating income for November?

Absorption-Costing Income Statement Refer to the data for Osterman Company above. Required: 1. Calculate the cost of goods sold under absorption costing. 2. Prepare an income statement using absorption costing. Use the following information for Brief Exercises 3-23 and 3-24: During the most recent year, Osterman Company had the following data:

Variable costing Marley Company has the following information for March: Determine (A) the manufacturing margin, (B) the contribution margin, and (C) operating income for Marley Company for the month of March.

To determine the effect of different levels of production on the company’s income, move to cell B7 (Actual production). Change the number in B7 to the different production levels given in the table below. The first level, 100,000, is the current level. What happens to the operating income on both statements as production levels change? Enter the operating incomes in the following table. Does the level of production affect income under either costing method? Explain your findings.

Using the data in P4-2 and Microsoft Excel: 1. Separate the variable and fixed elements. 2. Determine the cost to be charged to the product for the year. 3. Determine the cost to be charged to factory overhead for the year. 4. Determine the plotted data points using Chart Wizard. 5. Determine R2. 6. How do these solutions compare to the solutions in P4-2 and P4-3? 7. What does R2 tell you about this cost model?