makes an oak desk specially designed for personal computers. Thedesk sells for $205. Data for last yearâs operations follow:
Units in beginninginventory 0 Units produced 9,800 Units sold 9,300 Units in endinginventory 500 Variable costs perunit: Direct materials $ 61 Direct labor 39 Variable manufacturingoverhead 15 Variable selling andadministrative 20 Total variable costper unit $ 135 Fixed costs: Fixed manufacturingoverhead $ 323,400 Fixed selling andadministrative 510,000 Total fixedcosts $ 833,400
Required:
1. Assume that the company uses absorption costing. Compute theunit product cost for one computer desk. (Round your answerto the nearest whole dollar.)
2. Assume that the company uses absorption costing. Prepare anincome statement.
makes an oak desk specially designed for personal computers. Thedesk sells for $205. Data for last yearâs operations follow: |
| Units in beginninginventory | 0 | |
| Units produced | 9,800 | |
| Units sold | 9,300 | |
| Units in endinginventory | 500 | |
| Variable costs perunit: | ||
| Direct materials | $ 61 | |
| Direct labor | 39 | |
| Variable manufacturingoverhead | 15 | |
| Variable selling andadministrative | 20 | |
| Total variable costper unit | $ 135 | |
| Fixed costs: | ||
| Fixed manufacturingoverhead | $ | 323,400 |
| Fixed selling andadministrative | 510,000 | |
| Total fixedcosts | $ | 833,400 |
| Required: |
| 1. | Assume that the company uses absorption costing. Compute theunit product cost for one computer desk. (Round your answerto the nearest whole dollar.) |
| 2. | Assume that the company uses absorption costing. Prepare anincome statement. |
Related questions
Chuck Wagon Grills, Inc., makes a single productâa handmadespecialty barbecue grill that it sells for $215. Data for lastyearâs operations follow: |
| Units in beginninginventory | 0 | |
| Units produced | 9,900 | |
| Units sold | 9,200 | |
| Units in endinginventory | 700 | |
| Variable costs perunit: | ||
| Direct materials | $ 62 | |
| Direct labor | 37 | |
| Variable manufacturingoverhead | 13 | |
| Variable selling andadministrative | 20 | |
| Total variable cost perunit | $ 132 | |
| Fixed costs: | ||
| Fixed manufacturingoverhead | $ | 306,900 |
| Fixed selling andadministrative | 500,000 | |
| Total fixed costs | $ | 806,900 |
| Required: |
| 1. | Assume that the company uses absorption costing. Compute theunit product cost for one barbecue grill. |
| 2. | Assume that the company uses absorption costing. Prepare anincome statement. |
Ida Sidha Karya Company is a family-owned company located in thevillage of Gianyar on the island of Bali in Indonesia. The companyproduces a handcrafted Balinese musical instrument called a gamelanthat is similar to a xylophone. The gamelans are sold for $908.Selected data for the companyâs operations last year follow: |
| Units in beginninginventory | 0 | |
| Units produced | 21,000 | |
| Units sold | 19,000 | |
| Units in endinginventory | 2,000 | |
| Variable costs perunit: | ||
| Direct materials | $ 220 | |
| Direct labor | $ 460 | |
| Variable manufacturingoverhead | $ 62 | |
| Variable selling andadministrative | $ 21 | |
| Fixed costs: | ||
| Fixed manufacturingoverhead | $ 970,000 | |
| Fixed selling andadministrative | $ 830,000 | |
| Required: |
| 1. | Assume that the company uses absorption costing. Compute theunit product cost for one gamelan. |
| 2. | Assume that the company uses variable costing. Compute the unitproduct cost for one gamelan. |
Mahugh Corporation, which has only one product, has provided thefollowing data concerning its most recent month of operations:
| Selling price | 187 | |
| Units in beginninginventory | 0 | |
| Units produced | 3,660 | |
| Units sold | 3,100 | |
| Units in endinginventory | 560 | |
| Variable costs perunit: | ||
| Directmaterials | 50 | |
| Direct labor | 55 | |
| Variablemanufacturing overhead | 17 | |
| Variable selling andadministrative | 19 | |
| Fixed costs: | ||
| Fixed manufacturingoverhead | $ | 124,440 |
| Fixed selling andadministrative | $ | 9,300 |
Required:
a. What is the unit product cost for the monthunder variable costing? (Do not round intermediatecalculations.)
b. What is the unit product cost forthe month under absorption costing?
c. Prepare a contribution formatincome statement for the month using variable costing.
d. Prepare an income statement forthe month using absorption costing.
