Nesman Company, which has only one product, has provided thefollowing data concerning its most recent month of operations:
Selling price $ 115 Units in beginninginventory 390 Units produced 6,680 Units sold 6,570 Units in endinginventory 500 Variable costs perunit: Directmaterials $ 44 Direct labor $ 19 Variablemanufacturing overhead $ 3 Variable selling andadministrative $ 14 Fixed costs: Fixed manufacturingoverhead $ 160,320 Fixed selling andadministrative $ 59,130
The company produces the same number of units every month,although the sales in units vary from month to month. The company'svariable costs per unit and total fixed costs have been constantfrom month to month.
Required:
a. Prepare a contribution format income statement for the monthusing variable costing. (Input all amounts as positivevalues except losses which should be indicated by a minus sign.Omit the "$" sign in your response.)
Unitproduct cost under variable costing: Direct materials $ Direct labor Variable manufacturingoverhead Variable costing unitproduct cost $
Variable Costing Income Statement (Click to select)Netoperating income (loss)Manufacturing overheadSalesSelling andadministrative expensesVariable selling and administrativeexpensesVariable cost of goods soldContribution margin $ Variableexpenses: (Click to select)Variablecost of goods soldContribution marginManufacturing overheadDirectlaborSalesVariable selling and administrative expensesNet operatingincome $ (Click to select)DirectlaborVariable cost of goods soldNet operatingincomeSalesManufacturing overheadContribution marginVariableselling and administrative expenses (Click toselect)SalesSelling and administrative expensesContributionmarginVariable cost of goods soldManufacturing overheadNetoperating income (loss)Variable selling and administrativeexpenses Fixed expenses: (Click toselect)SalesVariable cost of goods soldContribution marginVariableselling and administrative expensesNet operating incomeFixedmanufacturing overheadFixed selling and administrativeexpenses (Click to select)Fixedmanufacturing overheadSalesFixed selling and administrativeexpensesNet operating incomeVariable selling and administrativeexpensesVariable cost of goods soldContribution margin (Click toselect)Variable cost of goods soldNet operating income(loss)Selling and administrative expensesSalesContributionmarginManufacturing overheadVariable selling and administrativeexpenses $
b. Prepare an income statement for the month using absorptioncosting. (Input all amounts as positive values exceptlosses which should be indicated by a minus sign. Leave no cellsblank - be certain to enter "0" wherever required. Omit the "$"sign in your response.)
Unitproduct cost under absorption costing: Direct materials $ Direct labor Variable manufacturingoverhead Fixed manufacturingoverhead cost Absorption costing unitproduct cost $
Absorption Costing Income Statement (Click to select)Netoperating income (loss)Cost of goods soldSalesSelling andadministrative expensesGross margin $ (Click toselect)Cost of goods soldGross marginSalesSelling andadministrative expensesNet operating income (loss) (Click toselect)Gross marginSelling and administrative expensesSalesNetoperating income (loss)Cost of goods sold (Click to select)Netoperating income (loss)SalesCost of goods soldSelling andadministrative expensesGross margin (Click toselect)Selling and administrative expensesCost of goodssoldSalesNet operating income (loss)Gross margin $
Nesman Company, which has only one product, has provided thefollowing data concerning its most recent month of operations: |
| Selling price | $ | 115 |
| Units in beginninginventory | 390 | |
| Units produced | 6,680 | |
| Units sold | 6,570 | |
| Units in endinginventory | 500 | |
| Variable costs perunit: | ||
| Directmaterials | $ | 44 |
| Direct labor | $ | 19 |
| Variablemanufacturing overhead | $ | 3 |
| Variable selling andadministrative | $ | 14 |
| Fixed costs: | ||
| Fixed manufacturingoverhead | $ | 160,320 |
| Fixed selling andadministrative | $ | 59,130 |
The company produces the same number of units every month,although the sales in units vary from month to month. The company'svariable costs per unit and total fixed costs have been constantfrom month to month. |
| Required: |
| a. | Prepare a contribution format income statement for the monthusing variable costing. (Input all amounts as positivevalues except losses which should be indicated by a minus sign.Omit the "$" sign in your response.) |
| Unitproduct cost under variable costing: | |
| Direct materials | $ |
| Direct labor | |
| Variable manufacturingoverhead | |
| Variable costing unitproduct cost | $ |
| Variable Costing Income Statement | ||
| (Click to select)Netoperating income (loss)Manufacturing overheadSalesSelling andadministrative expensesVariable selling and administrativeexpensesVariable cost of goods soldContribution margin | $ | |
| Variableexpenses: | ||
| (Click to select)Variablecost of goods soldContribution marginManufacturing overheadDirectlaborSalesVariable selling and administrative expensesNet operatingincome | $ | |
| (Click to select)DirectlaborVariable cost of goods soldNet operatingincomeSalesManufacturing overheadContribution marginVariableselling and administrative expenses | ||
| (Click toselect)SalesSelling and administrative expensesContributionmarginVariable cost of goods soldManufacturing overheadNetoperating income (loss)Variable selling and administrativeexpenses | ||
| Fixed expenses: | ||
| (Click toselect)SalesVariable cost of goods soldContribution marginVariableselling and administrative expensesNet operating incomeFixedmanufacturing overheadFixed selling and administrativeexpenses | ||
| (Click to select)Fixedmanufacturing overheadSalesFixed selling and administrativeexpensesNet operating incomeVariable selling and administrativeexpensesVariable cost of goods soldContribution margin | ||
| (Click toselect)Variable cost of goods soldNet operating income(loss)Selling and administrative expensesSalesContributionmarginManufacturing overheadVariable selling and administrativeexpenses | $ | |
| b. | Prepare an income statement for the month using absorptioncosting. (Input all amounts as positive values exceptlosses which should be indicated by a minus sign. Leave no cellsblank - be certain to enter "0" wherever required. Omit the "$"sign in your response.) |
| Unitproduct cost under absorption costing: | |
| Direct materials | $ |
| Direct labor | |
| Variable manufacturingoverhead | |
| Fixed manufacturingoverhead cost | |
| Absorption costing unitproduct cost | $ |
| Absorption Costing Income Statement | ||
| (Click to select)Netoperating income (loss)Cost of goods soldSalesSelling andadministrative expensesGross margin | $ | |
| (Click toselect)Cost of goods soldGross marginSalesSelling andadministrative expensesNet operating income (loss) | ||
| (Click toselect)Gross marginSelling and administrative expensesSalesNetoperating income (loss)Cost of goods sold | ||
| (Click to select)Netoperating income (loss)SalesCost of goods soldSelling andadministrative expensesGross margin | ||
| (Click toselect)Selling and administrative expensesCost of goodssoldSalesNet operating income (loss)Gross margin | $ | |
Related questions
Keyser Corporation, which has only one product, has provided thefollowing data concerning its most recent month of operations:
| Selling price | $ | 133 | |
| Units in beginninginventory | 950 | ||
| Units produced | 8,850 | ||
| Units sold | 8,950 | ||
| Units in ending inventory | 850 | ||
| Variable costs per unit: | ||
| Direct materials | $ | 29 |
| Direct labor | $ | 46 |
| Variable manufacturingoverhead | $ | 10 |
| Variable selling andadministrative expense | $ | 20 |
| Fixed costs: | ||
| Fixed manufacturingoverhead | $ | 70,800 |
| Fixed selling and administrativeexpense | $ | 164,200 |
The company produces the same number of units every month,although the sales in units vary from month to month. The company'svariable costs per unit and total fixed costs have been constantfrom month to month.
What is the net operating income for the month under variablecosting?
Packer Company, which has only one product, has provided thefollowing data concerning its most recent month of operations: |
| Selling price | $ | 112 |
| Units in beginninginventory | 590 | |
| Units produced | 2,000 | |
| Units sold | 2,210 | |
| Units in endinginventory | 380 | |
| Variable costs perunit: | ||
| Directmaterials | $ | 28 |
| Direct labor | $ | 25 |
| Variablemanufacturing overhead | $ | 2 |
| Variable selling andadministrative | $ | 20 |
| Fixed costs: | ||
| Fixed manufacturingoverhead | $ | 48,000 |
| Fixed selling andadministrative | $ | 6,630 |
The company produces the same number of units every month,although the sales in units vary from month to month. The company'svariable costs per unit and total fixed costs have been constantfrom month to month. (Hint: Use the reconciliation method.) |
| Required: |
| a. | What is the unit product cost for the month under variablecosting? (Omit the "$" sign in your response.) |
| Cost perunit | |
| Variablecosting | $ |
| b. | Prepare a contribution format income statement for the monthusing variable costing. (Input all amounts as positivevalues except losses which should be indicated by a minus sign.Omit the "$" sign in your response.) |
| Variable Costing Income Statement | ||
| (Click toselect)Manufacturing overheadContribution marginSalesNet operatingincome (loss)Selling and administrative expensesVariable cost ofgoods soldVariable selling and administrative expenses | $ | |
| Variableexpenses: | ||
| (Click to select)Variableselling and administrative expensesManufacturing overheadNetoperating incomeSalesContribution marginVariable cost of goodssold | $ | |
| (Click toselect)Contribution marginVariable cost of goods soldManufacturingoverheadNet operating incomeSalesVariable selling andadministrative expenses | ||
| (Click toselect)Contribution marginSalesVariable cost of goodssoldManufacturing overheadVariable selling and administrativeexpensesNet operating income (loss) | ||
| Fixed expenses: | ||
| (Click to select)SalesNetoperating incomeFixed selling and administrative expensesVariablecost of goods soldContribution marginFixed manufacturingoverheadVariable selling and administrative expenses | ||
| (Click to select)SalesNetoperating incomeVariable cost of goods soldVariable selling andadministrative expensesFixed selling and administrativeexpensesFixed manufacturing overheadContribution margin | ||
| (Click toselect)Variable selling and administrative expensesManufacturingoverheadNet operating income (loss)Variable cost of goodssoldSelling and administrative expensesContributionmarginSales | $ | |
| c. | Without preparing an income statement, determine the absorptioncosting net operating income for the month. (Omit the "$"sign in your response.) |
| Reconciliation of Variable Costing and Absorption Costing NetOperating Incomes | |
| Variable costing netoperating income | $ |
| (Click toselect)DeductAdd: (Click to select)Fixed manufacturing overheadcosts released from inventory under absorption costingFixedmanufacturing overhead costs deferred in inventory under absorptioncosting | |
| Absorption costingnet operating income | $ |
Khanam Corporation, which has only one product, has provided thefollowing data concerning its most recent month of operations: |
| Sellingprice | $149 |
| Units in beginninginventory | 1,150 |
| Units produced | 9,050 |
| Units sold | 9,150 |
| Units in endinginventory | 1,050 |
| Variable costs perunit: | |
| Directmaterials | $33 |
| Directlabor | $50 |
| Variablemanufacturing overhead | $14 |
| Variableselling and administrative | $24 |
| Fixed costs: | |
| Fixedmanufacturing overhead | $72,400 |
| Fixedselling and administrative | $165,400 |
The company produces the same number of units every month,although the sales in units vary from month to month. The company'svariable costs per unit and total fixed costs have been constantfrom month to month. |
What is the net operating income for the month under variablecosting?
