MANAG.ACCOUNTING-CONNECT ACCESS >CUSTOM<
17th Edition
ISBN: 9781266862434
Author: Garrison
Publisher: MCG CUSTOM
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Chapter 6, Problem 6E
| EXERCISE 6-6 Variable and Absorption Costing Unit Product Costs and Income Statements L06-1, LO6-2 |
| 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 | $24 | |||
| Direct labor | $14 | |||
| Variable manufacturing |
$2 | |||
| Variable selling and administrative | $4 | |||
| Fixed costs per year | ||||
| Fixed manufacturing overhead | $800,00 | |||
| Fixed selling and administrative expense | $496,000 |
| During the year, the company produced 25,000 units and sold 20,000 units. The selling price of the company's product is $50 per unit. |
|
| Required: | |
| Assume that the company uses absorption costing: | |
| Compute the unit product cost. | |
| Prepare an income statement for the year. | |
| Assume that the company uses variable costing: | |
| Compute the unit product cost. | |
| Prepare an income statement for the year. | |
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and West regions. The following information pertains to the company's first year of operations in which it
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GA GA GA
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Problem 6-18 (Algo) Variable and Absorption Costing Unit Product Costs and Income Statements [LO6-1, LO6-2]
Haas 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
$
24
Direct labor
$
16
Variable manufacturing overhead
$
4
Variable selling and administrative
$
1
Fixed costs per year:
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$
220,000
Fixed selling and administrative expenses
$
140,000
During its first year of operations, Haas produced 40,000 units and sold 40,000 units. During its second year of operations, it produced 55,000 units and sold 30,000 units. In its third year, Haas produced 20,000 units and sold 45,000 units. The selling price of the company’s product is $54 per unit.
Required:
b. Prepare an income statement for Year 1, Year 2, and Year 3.
Chapter 6 Solutions
MANAG.ACCOUNTING-CONNECT ACCESS >CUSTOM<
Ch. 6.A - Prob. 1ECh. 6.A - EXERCISE 6A-2 Super-Variable Costing and Variable...Ch. 6.A - Prob. 3ECh. 6.A - PROBLEM 6A-4 Super-Variable Costing and Variable...Ch. 6.A - Prob. 5PCh. 6 - Prob. 1QCh. 6 - Are selling and administrative expenses treated as...Ch. 6 - Explain how fixed manufacturing overhead costs are...Ch. 6 - What are the arguments in favor of treating fixed...Ch. 6 - What are the arguments in favor of treating fixed...
Ch. 6 - Prob. 6QCh. 6 - Prob. 7QCh. 6 - Prob. 8QCh. 6 - Under absorption costing, how is it possible to...Ch. 6 - Prob. 10QCh. 6 - Prob. 11QCh. 6 - What costs are assigned to a segment under the...Ch. 6 - Distinguish between a trace able fixed cost and a...Ch. 6 - Explain how the contribution margin differs from...Ch. 6 - Prob. 15QCh. 6 - Prob. 16QCh. 6 - Should a company allocate its common feed costs to...Ch. 6 - A B C D E 1 Chapter 6: Applying Excel 2 3 Data 4...Ch. 6 - A B C D E 1 Chapter 6: Applying Excel 2 3 Data 4...Ch. 6 - A B C D E
1 Chapter 6: Applying...Ch. 6 - Diego Company manufactures one product that is...Ch. 6 - Prob. 2F15Ch. 6 - Prob. 3F15Ch. 6 - Prob. 4F15Ch. 6 - Prob. 5F15Ch. 6 - Diego Company manufactures one product that is...Ch. 6 - Prob. 7F15Ch. 6 - Prob. 8F15Ch. 6 - Prob. 9F15Ch. 6 - Prob. 10F15Ch. 6 - Prob. 11F15Ch. 6 - Prob. 12F15Ch. 6 - Prob. 13F15Ch. 6 - Diego Company manufactures one product that is...Ch. 6 - Prob. 15F15Ch. 6 - Prob. 1ECh. 6 - Prob. 2ECh. 6 - Prob. 3ECh. 6 - Prob. 4ECh. 6 - Prob. 5ECh. 6 - EXERCISE 6-6 Variable and Absorption Costing Unit...Ch. 6 - Prob. 7ECh. 6 - Prob. 8ECh. 6 - EXERCISE 6-9 Variable and Absorption Costing Unit...Ch. 6 - Prob. 10ECh. 6 - Prob. 11ECh. 6 - Prob. 12ECh. 6 - Prob. 13ECh. 6 - Prob. 14ECh. 6 - EXERCISE 6—15 Absorption Costing Unit Product Cost...Ch. 6 - EXERCISE 6-16 Working with a Segmented Income...Ch. 6 - Prob. 17ECh. 6 - Prob. 18PCh. 6 - Prob. 19PCh. 6 - Prob. 20PCh. 6 - PROBLEM 6—21 Segment Reporting and Decision-Making...Ch. 6 - Prob. 22PCh. 6 - Prob. 23PCh. 6 - PROBLEM 6-24 Companywide and Segment Break-Even...Ch. 6 - Prob. 25PCh. 6 - Prob. 26PCh. 6 - PROBLEM 6-27 Incentives Created by Absorption...Ch. 6 - Prob. 28PCh. 6 - Prob. 29CCh. 6 - Prob. 30C
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