Dilithium Batteries is a division of Enterprise Corporation. The division manufa

Question

Dilithium Batteries is a division of Enterprise Corporation. The division manufactures and sells a long-life battery used in a wide variety of applications. During the coming year, it expects to sell 60,000 units for $35 per unit. Nyota Uthura is the division manager. She is considering producing either 60,000 or 90,000 units during the period. Other information is presented in the schedule ivision Information for Beginning inventory Expected sales in units Selling price per unit Variable manufacturing costs per unit Fixed manufacturing overhead costs (total) Fixed manufacturing overhead costs per unit: 60,000 $35 $13 $540,000 Based on 60,000 units Based on 90,000 units Manufacturing cost per unit: Based on 60,000 units Based on 90,000 units $9 per unit ($540,000 ÷ 60,000) $6 per unit ($540,000 ÷ 90,000) $22 per unit ($13 variable $9 fixed) $19 per unit ($13 variable $6 fixed) Variable selling and administrative expenses Fixed selling and administrative expenses (total) $5 $50,000

Explanation / Answer

DILITHIUM BATTERS DIVISION Income Statement For the year ended December 31 2017 Absorbtion costiing 60000Produced 90000Produced Sales                 21,00,000                21,00,000 Cost of goods sold                 13,20,000                11,40,000 Gross Profit                   7,80,000                  9,60,000 Variable Selling and administrative expenss                   3,00,000                  3,00,000 Fixed Selling and administrative expenss                       50,000                      50,000 Net income                   4,30,000                  6,10,000 Cost of goods sold Variable manufactoring cost                               13                              13 Fixed manufactoring cost                                 9                                6 Per unit cost                               22                              19 Total units 60000 60000 Total Cost of goods sold                 13,20,000                11,40,000 Variable Selling and administrative expenss Total units 60000 60000 Variable Selling and administrative expenss per unit 5 5 Total 300000 300000

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