Zola Company manufactures and sells one product. The following information perta
ID: 2547853 • Letter: Z
Question
Zola Company manufactures and sells one product. The following information pertains to the company's first year of operations: $ 14 Variable cost per unit: Direct materials Fixed costs per year: Direct labor Fixed manufacturing overhead Fixed selling and administrative expenses $157,250 $220,000 $ 67,500 The company does not incur any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, Zola produced 18,500 units and sold 14,800 units. The selling price of the company's product is $51.30 per unit. Required: 1. Assume the company uses super-variable costing: a. Compute the unit product cost for the year. b. Prepare an income statement for the year. Complete this question by entering your answers in the tabs below. Req 1A Req 1B Compute the unit product cost for the year. Assume the company uses super-variable costing. Unit product Cost K Reg 1A Req 1B >Explanation / Answer
Answer
Unit (Super-Variable Costing)
Direct Material
14
Per unit Cost
14
Income Statement (Super-Variable Costing)
Year 1
Detail
Net
Sales (@ 51.30 per unit)
759,240
Less: Cost of Goods Sold
Opening Inventory
-
Add: Cost of goods Manufactured
(18,500 Units * $14 per unit)
259,000
Less: Closing Inventory
(3,700 Units * $14 per unit)
(51,800)
207,200
Contribution Margin
552,040
Less: Fixed Cost
Direct Labor
157,250
Fixed Manufacturing Cost
220,000
Fixed Selling and Adm. Expenses
67,500
444,750
Net Operating Income
107,290
Unit (Super-Variable Costing)
Direct Material
14
Per unit Cost
14
Income Statement (Super-Variable Costing)
Year 1
Detail
Net
Sales (@ 51.30 per unit)
759,240
Less: Cost of Goods Sold
Opening Inventory
-
Add: Cost of goods Manufactured
(18,500 Units * $14 per unit)
259,000
Less: Closing Inventory
(3,700 Units * $14 per unit)
(51,800)
207,200
Contribution Margin
552,040
Less: Fixed Cost
Direct Labor
157,250
Fixed Manufacturing Cost
220,000
Fixed Selling and Adm. Expenses
67,500
444,750
Net Operating Income
107,290
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