Given the total cost and output for the month at ACME shown below develop a spre

Question

Given the total cost and output for the month at ACME shown below develop a spreadsheet that can calculate the total and per unit values for the accounting entities named here: prime cost, conversion cost, full absorption cost, contribution margin, gross margin, and profit.

Direct Mfg. Materials=$224,000 Variable Marketing & Admin=$89000

Direct Mfg. Labor=$196,000 Fixed Marketing & Admin=$36,000

Variable Mfg. Overhead Labor=$56000 Total Sales Revenue=$832,000

Variable Mfg. Overhead Mtls.=$26000 Units Sold=2200

Fixed Mfg. Overhead=$78000

Explanation / Answer

1)prime cost

= Direct Mfg. Materials=$224,000 + Direct Mfg. Labor=$196,000

2)conversion cost

= Direct Mfg. Labor=$196,000 + Variable Mfg. Overhead Labor=$56000 + Variable Mfg. Overhead Mtls.=$26000

3) full absorption cost

Direct Mfg. Materials=$224,000 + Direct Mfg. Labor=$196,000 + Variable Mfg. Overhead Labor=$56000 + Variable Mfg. Overhead Mtls.=$26000 +Fixed Mfg. Overhead=$78000

4)contribution margin

The result of subtracting all variable expenses from revenues. It indicates the amount available from sales to cover the fixed expenses and profit.

Total Sales Revenue=$832,000 -(Variable Mfg. Overhead Labor=$56000 + Variable Mfg. Overhead Mtls.=$26000 +Variable Marketing & Admin=$89000)

5)gross margin

(Total Sales Revenue=$832,000 - costs of goods sold)/ Total Sales Revenue=$832,000

6)profit.

total revenue - total expenses

Related Questions

Navigate

• Browse (All)
• Browse G
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.