clezto.mheducation com/hm.tpx connect Hw 6 Questons 2-3or6) Exercise 6-7 Income
ID: 2539222 • Letter: C
Question
clezto.mheducation com/hm.tpx connect Hw 6 Questons 2-3or6) Exercise 6-7 Income reporting under absorption costing and variable costing LO P2 The following information spplies to the questions displayed below Dak Mort a producer of solid osk tobles,reports the fallowing data from its second year af business Sales price per unit Units produced this year Units sold this yeer Units in beginningyeer inventory Beginning inventory costs 310 per unit 105.000 units 08750 units 3,750 unitS Vanable (3,750 units $135) $ 506,250 281.250 Fxed 3750 units $75) Total Direaa meterials 787,500 Menufocturing costs this year Direct lebor Overhesd costs this year 50 per unit 70 per unit Varlable overhead Flxed overhead $3.600.000 $7,600,000 Seiling and sominstrative costs this year Vartlable Fbred $1,400.000 4400000Explanation / Answer
v
Answer 1.
OAK MART
Absorption Costing Income Statement
Sales - 108,750 X $310 33,712,500.00
Less: Cost of Goods Sold
Beginning Inventory
Variable 506,250.00
Fixed 281,250.00
Cost of Goods Sold - Beginning Inventory 787,500.00
Manufactured During the Year:
Direct Material - 105,000 Units X $50 5,250,000.00
Direct Labor - 105,000 Units X $70 7,350,000.00
Overhead Costs this Year:
Variable Overhead 3,600,000.00
Fixed Overhead 7,600,000.00
Cost of Goods Sold - Manufactured During the year 23,800,000.00
Total Cost of Goods Sold 24,587,500.00
Gross Margin 9,125,000.00
Less: Selling & Administrative Expense
Variable Selling & Admn. Exp. 1,400,000.00
Fixed Selling & Admn. Exp. 4,400,000.00
Total Selling & Administrative Expense 5,800,000.00
Net Operating Income 3,325,000.00
Answer 2.
DOWELL Company
Variable Costing Income Statement
2014 2015
Units Sold 21,000 41,000
Sales - $44 per Unit 924,000.00 1,804,000.00
Less: Cost of Goods Sold
Manufactured During The Year
Direct Materials - $5 per Unit 105,000.00 155,000.00
Direct Labor - $9 per Unit 189,000.00 279,000.00
Variable Overhead - $5 per Unit 105,000.00 155,000.00
Cost of Goods Sold - Manufactured During the year 399,000.00 589,000.00
Cost of Goods Sold - Beginning Inventory
Direct Materials - $5 per Unit 50,000.00
Direct Labor - $9 per Unit 90,000.00
Variable Overhead - $5 per Unit 50,000.00
Cost of Goods Sold - Beginning Inventory - 190,000.00
Total Cost of Goods Sold 399,000.00 779,000.00
Manufacturing Margin 525,000.00 1,025,000.00
Variable selling & Administration expense 36,750.00 71,750.00
Contribution margin 488,250.00 953,250.00
Fixed Expenses:
Fixed Overhead 310,000.00 310,000.00
Fixed Selling & Admn. Expense 245,000.00 245,000.00
Total Fixed Expenses 555,000.00 555,000.00
Net Operating Income (66,750.00) 398,250.00
Answer 3.
TREZ Company
Variable Costing Income Statement
Sales - 80,000 Units x $50 4,000,000.00
Less: Cost of Goods Sold
Direct Materials - $80,000 X $3 240,000.00
Direct Labor - $80,000 X $16 1,280,000.00
Variable Overhead - $80,000 X $3 240,000.00 1,760,000.00
Manufacturing Margin 2,240,000.00
Variable Selling & Admn. Exp. - $80,000 X $2.25 180,000.00
Contribution Margin 2,060,000.00
Less: Fixed Expenses
Fixed Overhead 800,000.00
Fixed Selling & Admn. Exp. 400,000.00
Total Fixed Expenses 1,200,000.00
Net Income (Loss) 860,000.00
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.