Managerial Accounting
15th Edition
ISBN: 9781337912020
Author: Carl Warren, Ph.d. Cma William B. Tayler
Publisher: South-Western College Pub
expand_more
expand_more
format_list_bulleted
Concept explainers
Textbook Question
Chapter 7, Problem 4CMA
Bethany Company has just completed the first month of producing a new product but has not yet shipped any of this product. The product incurred variable
- a. $5,000,000.
- b. $6,000,000.
- c. $8,000,000.
- d. $11,000,000.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
Company XYZ produced 1,000 units of product A. At this level, the variable manufacturing
costs were OMR1,080,000 and the variable selling and administrative costs were
OMR150,000. Furthermore, the total fixed cost was OMR180,000. Assuming the company
increased the production level to 1,090 units, what would be the increase in total
manufacturing costs?
Select one:
a. OMR97,200
b. None of the given answers
c. OMR126,900
d. OMR113,400
e. OMR110,700
Clear my
y choice
Company XYZ produced 1,000 units of product A. At this level, the variable manufacturing costs were
OMR360,000 and the variable selling and administrative costs were OMR90,000. Furthermore, the total fixed
cost was OMR120,000. Assuming the company increased the production level to 1,030 units, what would be
the increase in total manufacturing costs?
Select one:
O a. OMR14,400
O b. OMR10,800
c. None of the given answers
O d. OMR13,500
O e. OMR17,100
The following information is available for SAN JOSE CORP.'s new product line:
Sale price per unit
Variable manufacturing cost per unit of production
Total annual fixed manufacturing cost
Variable administrative cost per unit
Total annual fixed administrative expenses
There was no inventory at the beginning of the year. Normal capacity is 12,500 units. During the year,
12,000 units were produced and 10,000 units were sold.
REQUIREMENTS:
(1)
6
P 30
8.
25,000
15,000
What is the cost of ending inventory under direct costing and absorption costing, respectively?
(2)
What is the net income under direct costing and absorption costing, respectively?
Chapter 7 Solutions
Managerial Accounting
Ch. 7 - What types of costs are customarily included in...Ch. 7 - Which type of manufacturing cost (direct...Ch. 7 - Which of the following costs would be included in...Ch. 7 - In the variable costing income statement, how are...Ch. 7 - Prob. 5DQCh. 7 - Prob. 6DQCh. 7 - Discuss how financial data prepared on the basis...Ch. 7 - Prob. 8DQCh. 7 - Explain why rewarding sales personnel on the basis...Ch. 7 - Explain why service companies use different...
Ch. 7 - Variable costing Marley Company has the following...Ch. 7 - Prob. 2BECh. 7 - Variable costingsales exceed production The...Ch. 7 - Prob. 4BECh. 7 - Contribution margin by segment The following...Ch. 7 - At the end of the first year of operations, 21,500...Ch. 7 - Gallatin County Motors Inc. assembles and sells...Ch. 7 - Fresno Industries Inc. manufactures and sells...Ch. 7 - On March 31, the end of the first month of...Ch. 7 - On April 30, the end of the first month of...Ch. 7 - On October 31, the end of the first month of...Ch. 7 - The following data were adapted from a recent...Ch. 7 - Estimated income statements, using absorption and...Ch. 7 - The following data were adapted from a recent...Ch. 7 - Prob. 10ECh. 7 - Explain why service companies use different...Ch. 7 - Galaxy Sports Inc. manufactures and sells two...Ch. 7 - Prob. 13ECh. 7 - Sales territory and salesperson profitability...Ch. 7 - Prob. 15ECh. 7 - Prob. 16ECh. 7 - Variable costing income statement for a service...Ch. 7 - Variable costing income statement for a service...Ch. 7 - Prob. 1PACh. 7 - The demand for solvent, one of numerous products...Ch. 7 - During the first month of operations ended May 31,...Ch. 7 - Salespersons report and analysis Walthman...Ch. 7 - Segment variable costing income statement and...Ch. 7 - Absorption and variable costing income statements...Ch. 7 - Income statements under absorption costing and...Ch. 7 - Absorption and variable costing income statements...Ch. 7 - Prob. 4PBCh. 7 - Variable costing income statement and effect on...Ch. 7 - Prob. 1MADCh. 7 - Prob. 2MADCh. 7 - Prob. 3MADCh. 7 - Segment disclosure by Apple Inc. (AAPL) provides...Ch. 7 - Prob. 1TIFCh. 7 - Inventory effects under absorption costing BendOR,...Ch. 7 - Communication Bon Jager Inc. manufactures and...Ch. 7 - Prob. 1CMACh. 7 - Chassen Company, a cracker and cookie...Ch. 7 - Prob. 3CMACh. 7 - Bethany Company has just completed the first month...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Company XYZ produced 1,000 units of product A. At this level, the variable manufacturing costs were OMR240,000 and the variable selling and administrative costs were OMR80,000. Furthermore, the total fixed cost was OMR110,000. Assuming the company increased the production level to 1,020 units, what would be the increase in total manufacturing costs? Select one: O a. OMR7,000 O b. OMR6,400 C OMR4,800 O d. OMR8,600 O e. None of the given answers YZ Corpany uses a job cesting system andapples anufacturing overheadusinepredeteminedarrow_forwardCarla Vista Company sells its product for $10400 per unit. Variable costs per unit are: manufacturing, $5000; and selling and administrative, $120. Fixed costs are: $34000 manufacturing overhead, and $44000 selling and administrative. There was no beginning inventory at 1/1/20. Production was 34 units per year in 2020–2022. Sales were 34 units in 2020, 30 units in 2021, and 38 units in 2022. Income under variable costing for 2021 is $164800. $80400. $84400. $88000.arrow_forwardBlossom Company sells its product for $11000 per unit. Variable costs per unit are: manufacturing, $5900; and selling and administrative, $120. Fixed costs are: $31200 manufacturing overhead, and $41200 selling and administrative. There was no beginning inventory at 1/1/20. Production was 24 units per year in 2020–2022. Sales were 24 units in 2020, 20 units in 2021, and 28 units in 2022. Income under variable costing for 2021 is $32400. $59600. $27200. $34800.arrow_forward
- Solve this problem with questionarrow_forwardBent Tree incurred the following unit costs during the year: variable manufacturing cost, $27; fixed manufacturing cost, $10; variable marketing and administrative cost, $8; and fixed marketing and administrative cost, $6. During the year, Bent Tree produced 30,000 units and sold 25,000 units of product. The selling price was $67 per unit. What was Bent Tree's total gross margin? Multiple Choice None of these. $1,000,000 $400,000 $750,000 $800,000arrow_forwardProduct BW of Blair Designs generates sales revenue of $40,000. The product incurs variable costs of goods sold of $22,000, fixed selling costs of $22,000, and fixed factory overhead of $21,000. Determine if Product BW should be continued or discontinued. Assume that the company will incur the fixed factory overhead regardless of the decision. Support your conclusion with numbers. The fixed selling cost is avoidable.arrow_forward
- Glover Inc. manufactures Product B, incurring variable costs of $15.00 per unit and fixed costs of $70,000. Glover desires a profit equal to a 12% rate of return on assets. Assets of $785,000 are devoted to producing Product B, and 100,000 units are expected to be produced and sold. a. Compute the markup percentage using the total cost concept.fill in the blank 1 % b. Compute the selling price of Product B. Round your answer to two decimal places.$fill in the blank 2arrow_forwardGarrett Company provided the following information: Common fixed cost totaled $46,000. Garrett allocates common fixed cost to Product 1and Product 2 on the basis of sales. If Product 2 is dropped, which of the following is true?a. Sales will increase by $300,000.b. Overall operating income will increase by $2,600.c. Overall operating income will decrease by $25,000.d. Overall operating income will not change.e. Common fixed cost will decrease by $27,600.arrow_forwardA company has a linear total cost function and has determined that over the next three months it can produce12,000 units at a total cost of $224; 000. This same manufacturer can produce 18,000 units at a total cost of$296; 000. The selling price per unit is $13.25.i. Determine the revenue, cost and prot functions using q for number of units.ii. What is the xed cost ?iii. What is the marginal cost ?iv. Find the break-even quantity.v. What is the break-even dollar volume of sale ?vi. What will prot be if the company shuts down operation?vii. If, because of a strike, the company will be able to produce only 10,000 units, should it shut down for the nextthree months ? why or why not ?arrow_forward
- Polka King Gifts had the following costs in March when 400 ceramic statues were produced: materials, $4,200; labor cost, $1,600; depreciation, $800; rent, $700; and other fixed costs, $500. If production changes to 500 units and production still remains within the relevant range, which of the following costs will stay the same? A. Total variable cost B. Variable cost per unit C. Fixed cost per unit D. None of these answer choices is correct. E. Total cost per unitarrow_forwardSpock Company incurs the following costs to produce and sell a single product. Variable costs per unit: Direct materials. $9 $10 Direct labor.. Variable manufacturing overhead.. Variable selling and administrative expenses.. Fixed costs per year: Fixed manufacturing overhead... Fixed selling and administrative expenses. $5 $3 $150,000 $40,000 Is the company using absorption costing or variable costing to cost units in the Finished Goods inventory account? Show computations to support your answer.arrow_forwardThe Southern Corporation manufactures a single product and has the following cost structure: Variable costs per unit: Production $ 35 Selling and administrative $ 13 Fixed costs per year: Production $96,320 Selling and administrative $84,760 Last year, 6,020 units were produced and 5,920 units were sold. There was no beginning inventory. The carrying value on the balance sheet of the ending inventory of finished goods under variable costing would be:.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education
Cost Accounting - Definition, Purpose, Types, How it Works?; Author: WallStreetMojo;https://www.youtube.com/watch?v=AwrwUf8vYEY;License: Standard YouTube License, CC-BY