Please do not give solution in image format thanku Start Me Up Inc. manufactures a caffeinated energy drink that sells for $4.30 each. The results for its first year ofoperations appear in the table below:Number of drinks producedNumber of drinks soldProjectionsDirect materials per drink$Direct labor per drink$Variable manufacturing overhead per drink $Total fixed manufacturing overhead$Total fixed selling and administrative costs $49,00046,200PLEASE ANSWER ASAP, THANK YOU!0.580.280.1830,38051,500Required:1. Compute the operating income for the first year under full costing.2. Compute the operating income for the first year under variable costing.(For all requirements, do not round intermediate calculations.)1. Operating income for the first year under full costing2. Operating income for the first year under variable costing

Under absorption costing all costs like material, labour, variable manufacturing overhead and fixed…

Answered: 1. Operating income for the first year…

Business

Accounting

1. Operating income for the first year under full costing 2. Operating income for the first year under variable costing

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter8: Standard Cost Accounting—materials, Labor, And Factory Overhead

Section: Chapter Questions

Problem 3P: Zippy Inc. manufactures a fuel additive, Surge, which has a stable selling price of 44 per drum. The...

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Genuine Spice Inc. began operations on January 1 of the current year. The company produces 8-ounce bottles of hand and body lotion called Eternal Beauty. The lotion is sold wholesale in 12-bottle cases for 100 per case. There is a selling commission of 20 per case. The January direct materials, direct labor, and factory overhead costs are as follows: DIRECT MATERIALS Cost Behavior Units per Case Cost per Unit Direct Materials Cost per Case Cream base Variable 100 ozs. 0.02 2.00 Natural oils Variable 30ozs. 0.30 9.00 Bottle (8-OZ-) Variable 12 bottles 0.50 6.00 17.00 DIRECT LABOR Department Cost Behavior Time per Case Labor Rate per Hour Direct Labor Cost per Case Mixing Variable 20 min. 18.00 6.00 Filling Variable 5 14.40 1.2 25 min. 7.20 FACTORY OVERHEAD Cost Behavior Total Cost Utilities Mixed 600 Facility lease Fixed 14,000 Equipment depreciation Fixed 4,300 Supplies Fixed 660 19,560 Part ABreak-Even Analysis The management of Genuine Spice Inc. wishes to determine the number of cases required to break even per month. The utilities cost, which is part of factory overhead, is a mixed cost. The following information was gathered from the first six months of operation regarding this cost: Month Case Production Utility Total Cost January 500 600 February 800 660 March 1,200 740 April 1,100 720 May 950 690 June 1,025 705 Instructions 1. Determine the fixed and variable portions of the utility cost using the high-low method. 2. Determine the contribution margin per ease. 3. Determine the fixed costs per month, including the utility fixed cost from part (1). 4. Determine the break-even number of cases per month. Part BAugust Budgets During July of the current year, the management of Genuine Spice Inc. asked the controller to prepare August manufacturing and income statement budgets. Demand was expected to be 1,500 cases at 100 per case for August. Inventory planning information is provided as follows: Finished Goods Inventory: Cases Cost Estimated finished goods inventory, August 1 300 12,000 Desired finished goods inventory, August 31 175 7,000 Materials Inventory: Cream Base (ozs.) Oils (ozs.) Bottles (bottles) Estimated materials inventory, August 1 250 290 600 Desired materials inventory, August 31 1,000 360 240 There was negligible work in process inventory assumed for either the beginning or end of the month; thus, none was assumed. In addition, there was no change in tile cost per unit or estimated units per case operating data from January. Instructions 5. Prepare the August production budget. 6. Prepare the August direct materials purchases budget. 7. Prepare the August direct labor budget. Round the hours required for production to the nearest hour. 8. Prepare the August factory overhead budget. 9. Prepare the August budgeted income statement, including selling expenses. Part CAugust Variance Analysis During September of the current year, the controller was asked to perform variance analyses for August. The January operating data provided the standard prices, rates, times, and quantities per case. There were 1,500 actual cases produced during August, which was 250 more cases than planned at the Beginning of the month. Actual data for August were as follows: Actual Direct Materials Price per Unit Actual Direct Materials Quantity per Case Cream base 0.016 per oz. 102 ozs. Natural oils 0.32 per oz. 31 ozs. Bottle (8 oz.) 0.42 per bottle 12.5 bottles Actual Direct Labor Rate Actual Direct Labor Time per Case Mixing 18.20 19.50 min. Filling 14.00 5.60 min. Actual variable overhead 305.00 Normal volume 1,600 cases The prices of the materials were different than .standard due to fluctuations in market prices. The standard quantity of materials used per case was an ideal standard. The Mixing Department used a higher grade labor classification during the month, thus causing the actual labor rale to exceed standard. The Filling Department used a lower grade labor classification during the month, thus causing the actual labor rate to be less titan standard. Instructions 10. Determine and interpret the direct materials price and quantity variances for the three materials. 11. Determine and interpret the direct labor rate and time variances for the two departments. Round hours to the nearest hour. 12. Determine and interpret the factory overhead controllable variance. 13. Determine and interpret the factory overhead volume variance. 14. Why are the standard direct labor and direct materials costs in the calculations for parts (10) and (11) based on the actual 1,500-case production volume rather than the planned 1,250 cases of production used in the budgets for parts (6) and (7)?
Brody Company makes industrial cleaning solvents. Various chemicals, detergent, and water are mixed together and then bottled in 10-gallon drums. Brody provided the following information for last year: Last year, Brody completed 100,000 units. Sales revenue equaled 1,200,000, and Brody paid a sales commission of 5 percent of sales. Required: 1. Calculate the direct materials used in production for last year. 2. Calculate total prime cost. 3. Calculate total conversion cost. 4. Prepare a cost of goods manufactured statement for last year. Calculate the unit product cost. 5. Prepare a cost of goods sold statement for last year. 6. Prepare an income statement for last year. Show the percentage of sales that each line item represents.
Zippy Inc. manufactures a fuel additive, Surge, which has a stable selling price of 44 per drum. The company has been producing and selling 80,000 drums per month. In connection with your examination of Zippys financial statements for the year ended September 30, management has asked you to review some computations made by Zippys cost accountant. Your working papers disclose the following about the companys operations: Standard costs per drum of product manufactured: Materials: Costs and expenses during September: Chemicals: 645,000 gallons purchased at a cost of 1,140,000; 600,000 gallons used. Empty drums: 94,000 purchased at a cost of 94,000; 80,000 drums used. Direct labor: 81,000 hours worked at a cost of 816,480. Factory overhead: 768,000. Required: Calculate the following for September, using the formulas on pages 421422 and 424 (Round unit costs to the nearest whole cent and compute the materials variances for both Surge and for the drums.): 1. Materials quantity variance. 2. Materials purchase price variance. 3. Labor efficiency variance. 4. Labor rate variance.
Royal Lawncare Company produces and sells two packaged products—Weedban and Greengrow. Revenue and cost information relating to the products follow: Product Weedban GreengrowSelling price per unit $ 9.00 $ 33.00Variable expenses per unit $ 2.50 $ 12.00Traceable fixed expenses per year $ 136,000 $ 41,000 Common fixed expenses in the company total $110,000 annually. Last year the company produced and sold 37,000 units of Weedban and 19,500 units of Greengrow. Required: Prepare a contribution format income statement segmented by product lines.
Royal Lawncare Company produces and sells two packaged products—Weedban and Greengrow. Revenue and cost information relating to the products follow: Product Weedban Greengrow Selling price per unit $ 12.00 $ 32.00 Variable expenses per unit $ 2.40 $ 12.00 Traceable fixed expenses per year $ 129,000 $ 34,000 Common fixed expenses in the company total $111,000 annually. Last year the company produced and sold 39,500 units of Weedban and 17,000 units of Greengrow. Required: Prepare a contribution format income statement segmented by product lines.
Royal Lawncare Company produces and sells two packaged products-Weedban and Greengrow. Revenue and cost information relating to the products follow: Product Weedban Selling price per unit Variable expenses per unit Traceable fixed expenses per year $ $ $ 133,000 Greengrow $ $ $ 44,000 8.00 34.00 2.40 13.00 Common fixed expenses in the company total $95,000 annually. Last year the company produced and sold 37,000 units of Weedban and 16,000 units of Greengrow. Required: Prepare a contribution format income statement segmented by product lines. Product Line Total Company Weedban Greengrow
Succulent juice Company manufactures and sells premium tomato juice by the gallon. Succulent just finished its first year of operations. The following data relates to this first year of operations. Number of Gallons Produced 80,000 Number of Gallons sold 70,000 $3.00 per gallon $1.45 per gallon $84,000 Sales Price Unit Product Cost (variable costing) Contribution Margin Total Fixed Manufacturing Overhead Total fixed Selling & Administrative $25,000 Variable Selling and Administrative Costs Inventory value under absorption costing $29,500 Prepare an Income Statement for Succulent using the Absorption Costing Method. (Hints: How many units were in inventory? What was the cost per unit? Why is the CM only $84,000? ). 3.1 Sales COGS Gross Margin SG&A Net Income 3.2 Explain in one or two sentences, the key difference between the net income under Absorption and the net income under Variable costing. Determine the variable costing net income. Do not prepare a variable costing income…
Royal Lawncare Company produces and sells two packaged products—Weedban and Greengrow. Revenue and cost information relating to the products follow: Product Weedban Greengrow Selling price per unit $ 11.00 $ 30.00 Variable expenses per unit $ 2.40 $ 12.00 Traceable fixed expenses per year $ 134,000 $ 30,000 Common fixed expenses in the company total $104,000 annually. Last year the company produced and sold 35,500 units of Weedban and 25,000 units of Greengrow. Required: Prepare a contribution format income statement segmented by product lines. Product Line Total Company Weedban Greengrow 0 0 0 0 $0 $0 $0
The following information pertains to the first year of operation for Crystal Cold Coolers Incorporated: Number of units produced Number of units sold 3,100 2,600 $ 355 Unit sales price Direct materials per unit Direct labor per unit Variable manufacturing overhead per unit Fixed manufacturing overhead per unit ($201,500÷3,100 units) Total variable selling expenses ($14 per unit sold) Total fixed general and administrative expenses Complete this question by entering your answers in the tabs below. Full Absorption Costing Required: Prepare Crystal Cold's full absorption costing income statement and variable costing income statement for the y Answer is not complete. Variable Costing Prepare Crystal Cold's full absorption costing income statement for the year. Crystal Cold Coolers Incorporated Full Absorption Costing Income Statement Sales $ 60 $ 50 923,000 $12 $65 $36,400 $ 65,000
San Luis Obispo, California based SLOboards, Inc. manufactures a single line of paddleboards. For the year ended 12.31.21, SLOboards manufactured and sold a total of 1,000 boards. The following information was compiled for 2021 based on the 2021 production and sales volume: Sales Revenue . . . $500,000 Total Variable Costs . . . $200,000 Total Fixed Costs . . . $160,000 SLOboards is considering relocating its operations to Morro Bay, California in 2023. If the company relocates to Morro Bay, the sales price will not change. The variable cost per board in Morro Bay will decrease to $150, but the total annual fixed manufacturing costs will increase by $55,000. Which of the following statements is correct? A. If annual unit sales in 2023 are expected to be less than 1,100, the company should move its operations to Morro Bay. B. SLOboards' 2021 operating income was $85,000. C. If operations are moved to Morro Bay, the annual breakeven point…
Jay-Zee Company makes an in-car navigation system. Next year, Jay-Zee plans to sell 17,000 units at a price of $390 each. Product costs include: Direct materials $82.00 Direct labor $47.00 Variable overhead $12.00 Total fixed factory overhead $647,250 Variable selling expense is a commission of 5 percent of price; fixed selling and administrative expenses total $97,000. Required: Question Content Area 1. Calculate the sales commission per unit sold. If required, round your answers to the nearest dollar. Use rounded answers in subsequent computations.$________ per unit Calculate the contribution margin per unit.$________ per unit 2. How many units must Jay-Zee Company sell to break even? Round your answer to the nearest whole number. ________units Prepare an income statement for the calculated number of units. If an amount is zero, enter "0". Do NOT round Break-even units and, if required, round your answer to the nearest dollar. blank Sales $______ Less:…
The following information pertains to the first year of operation for Crystal Cold Coolers Inc.: Number of units produced Number of units sold Unit sales price Direct materials per unit Direct labor per unit Variable manufacturing overhead per unit Fixed manufacturing overhead per unit ($224,000/2,800 units) Total variable selling expenses ($11 per unit sold) Total fixed general and administrative expenses Complete this question by entering your answers in the tabs below. Required: Prepare Crystal Cold's full absorption costing income statement and variable costing income statement for the year. Full Absorption Costing 2,800 2,400 340 60 45 13 80 Variable Costing $ 26,400 $ 60,000