ABC Company manufactures and sells a single product. The following costs were incurred during the company's first year of operations: Variable costs per unit: Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative Required: 1. Assume that the company uses absorption costing: a. Compute the unit product cost b. Prepare an income statement for the year. $ 2. Assume that the company uses variable costing: a. Compute the unit product cost b. Prepare an income statement for the year. $ 14 3 1 1 During the year, the company produced 29,000 units and sold 22,000 units. The selling price of the company's product is $42 per unit. $290,000 $200,000
ABC Company manufactures and sells a single product. The following costs were incurred during the company's first year of operations: Variable costs per unit: Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative Required: 1. Assume that the company uses absorption costing: a. Compute the unit product cost b. Prepare an income statement for the year. $ 2. Assume that the company uses variable costing: a. Compute the unit product cost b. Prepare an income statement for the year. $ 14 3 1 1 During the year, the company produced 29,000 units and sold 22,000 units. The selling price of the company's product is $42 per unit. $290,000 $200,000
Chapter5: Process Costing
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Problem 1PA: The following product Costs are available for Haworth Company on the production of chairs: direct...
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![ABC Company manufactures and sells a single product. The following costs were incurred during the company's first year of
operations:
Variable costs per unit:
Manufacturing:
Direct materials
Direct labor
Variable manufacturing overhead
Variable selling and administrative
Fixed costs per year:
Fixed manufacturing overhead
Fixed selling and administrative
Required:
1. Assume that the company uses absorption costing:
3
1
1
During the year, the company produced 29,000 units and sold 22,000 units. The selling price of the company's product is $42 per
unit.
a. Compute the unit product cost
b. Prepare an income statement for the year.
2. Assume that the company uses variable costing:
a. Compute the unit product cost.
b. Prepare an income statement for the year.
$290,000
$200,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fdc860f7d-8144-482b-af65-d08d28366106%2F65659183-2709-44b0-a695-c6336776bfed%2Fgtc4zxi_processed.jpeg&w=3840&q=75)
Transcribed Image Text:ABC Company manufactures and sells a single product. The following costs were incurred during the company's first year of
operations:
Variable costs per unit:
Manufacturing:
Direct materials
Direct labor
Variable manufacturing overhead
Variable selling and administrative
Fixed costs per year:
Fixed manufacturing overhead
Fixed selling and administrative
Required:
1. Assume that the company uses absorption costing:
3
1
1
During the year, the company produced 29,000 units and sold 22,000 units. The selling price of the company's product is $42 per
unit.
a. Compute the unit product cost
b. Prepare an income statement for the year.
2. Assume that the company uses variable costing:
a. Compute the unit product cost.
b. Prepare an income statement for the year.
$290,000
$200,000
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