Hello, I am working on the two questions below. I would be very grateful for hel

Question

Hello, I am working on the two questions below. I would be very grateful for help in solving the two questions.

1.

2. Crate Express Co. produces wooden crates used for shipping products by ocean liner. In 2017, Crate Express incurred the following costs.

Assume Crate Express used an average 500 kilowatt-hours each month over the past year.

(a) What is Crate Express's total manufacturing cost if it uses a variable costing approach?

(b) What is Crate Express's total manufacturing cost if it uses an absorption costing approach?

1. Langdon Company produced 8,600 units during the past year, but only 8,100 of the units were sold. The following additional information is also available.
Direct materials used $88,600 Direct labor incurred $28,000 Variable manufacturing overhead $21,000 Fixed manufacturing overhead $43,000 Fixed selling and administrative expenses $71,500 Variable selling and administrative expenses $8,000
There was no work in process inventory at the beginning and end of the year, nor did Langdon have any beginning finished goods inventory.

Explanation / Answer

1.a.

Under variable costing the cost of manufacture consists of only the variable costs.

Working:

1.b.  

Working:

2.a.

Working:

2.b.  

Working:

Finished Goods inventory cost $8,000

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