A business operated at 100% of capacity during its first month and incurred the following costs: Production costs (20,000 units): Direct materials $183,900 Direct labor 221,800 Variable factory overhead 259,300 Fixed factory overhead 92,000 $757,000 Operating expenses: Variable operating expenses $125,200 Fixed operating expenses 47,900 173,100 If 1,900 units remain unsold at the end of the month, the amount of inventory that would be reported on the variable costing balance sheet is Oa. $63,194 Ob. $71.915 Oc. $88,360 Od. $75,069

A business operated at 100% of capacity during its first month and incurred the following costs: Production costs (20,000 units): Direct materials $183,900 Direct labor 221,800 Variable factory overhead 259,300 Fixed factory overhead 92,000 $757,000 Operating expenses: Variable operating expenses $125,200 Fixed operating expenses 47,900 173,100 If 1,900 units remain unsold at the end of the month, the amount of inventory that would be reported on the variable costing balance sheet is Oa. $63,194 Ob. $71.915 Oc. $88,360 Od. $75,069

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter4: Activity-based Costing

Section: Chapter Questions

Problem 1E: Kennedy Appliance Inc.s Machining Department incurred 450,000 of factory overhead cost in producing...

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The following events took place for Rushmore Biking Inc. during February, the first month of operations as a producer of road bikes: Purchased 480,000 of materials. Used 434,500 of direct materials in production. Incurred 125,000 of direct labor wages. Applied factory overhead at a rate of 40% of direct labor cost. Transferred 578,000 of work in process to finished goods. Sold goods with a cost of 550,000. Revenues earned by selling bikes, 910,000. Incurred 185,000 of selling expenses. Incurred 90,000 of administrative expenses. a. Prepare the income statement for Rushmore Biking for the month ending February 28. b. Determine the inventory balances on February 28, the end of the first month of operations.
A company has the following transactions during the week. Purchase of $3,000 raw materials inventory Assignment of $700 of raw materials inventory to Job 7 Payroll for 10 hours and $3,000 is assigned to Job 7 Factory depreciation of $1,750 Overhead applied at the rate of $200 per hour What is the cost assigned to Job 7 at the end of the week?
Pattison Products, Inc., began operations in October and manufactured 40,000 units during the month with the following unit costs: Fixed overhead per unit = 280,000/40,000 units produced = 7. Total fixed factory overhead is 280,000 per month. During October, 38,400 units were sold at a price of 24, and fixed marketing and administrative expenses were 130,500. Required: 1. Calculate the cost of each unit using absorption costing. 2. How many units remain in ending inventory? What is the cost of ending inventory using absorption costing? 3. Prepare an absorption-costing income statement for Pattison Products, Inc., for the month of October. 4. What if November production was 40,000 units, costs were stable, and sales were 41,000 units? What is the cost of ending inventory? What is operating income for November?
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