Exercise 2) Elmer's Electronics has the following information for the first three years of business: 2019 10,000 2020 11,000 Units sold Units produced Fixed production costs Variable production costs per unit Selling price per unit Fixed selling & administrative expense 2021 12,000 8,000 S600,000 S 100 $ 20 S200,000 25,000 $600,000 $ 100 $ 200 $200,000 3,000 S600,000 S 100 $ 210 $200,000 Calculate income under both full costing and variable costing. What is the cost of ending inventory under full costing and under variable costing (assume FIFO)?

Exercise 2) Elmer's Electronics has the following information for the first three years of business: 2019 10,000 2020 11,000 Units sold Units produced Fixed production costs Variable production costs per unit Selling price per unit Fixed selling & administrative expense 2021 12,000 8,000 S600,000 S 100 $ 20 S200,000 25,000 $600,000 $ 100 $ 200 $200,000 3,000 S600,000 S 100 $ 210 $200,000 Calculate income under both full costing and variable costing. What is the cost of ending inventory under full costing and under variable costing (assume FIFO)?

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter2: Basic Managerial Accounting Concepts

Section: Chapter Questions

Problem 18MCQ: 2-18 Use the following information for Multiple- Choice Questions 2-13 through 2-18: Last year,...

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2-18 Use the following information for Multiple- Choice Questions 2-13 through 2-18: Last year, Barnard Company incurred the following costs: Barnard produced and sold 10,000 units at a price of 31 each. Refer to the information for Barnard Company on the previous page. Operating income is a. 34,000. b. 110,000. c. 234,000. d. 270,000. e. 74,000.
P2-3A Total Manufacturing Cost. Income Statement, Unit Cost, and Selling Price Two inventors, recently organized as Innovation, Inc., consult you regaridng and planned new product. They have estimates of the costs of materials, labor, overhead, and other expenses for 2019 but need to know how much to chanrge for each unit to earn a profit in 2019 equal to 15% of their estimated total long-term investment of $400,000 (ignore income taxes). Their plans indicate that each unit of the new product requires the following: Direct materials 4 lbs. of a materials costing $5/lb. Direct labor 2 hrs. of a meter former's time at $11/hr. 0.6 hr. of an assembler's time at $8/hr. Major items of production overhead would be annual rent of $46,460 for a factory building, $28,660 rent for machinery, and $21,700 of indirect materials. Other production overhead is estimated to be…
Q1) A company has the following accounts’ balances at the end of the year: Building (Net) 20 year life left $ 4,000,000. The replacement cost for the Building is 4,500,000 USD. Inventory 40,000 unit at $20 each with a replacement cost $22. And cost of goods sold of $500,000 with a replacement cost of 520,000. Required: Indicate how the above information would affect the financial statements of the company when adopting the current cost accounting model. You need to determine the realized and unrealized profit.
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Presented below is information related to Kaisson Corporation for the last 3 years. Base-Year Cost Current-Year Cost Item Quantitiesin EndingInventories Unit Cost Amount Unit Cost Amount December 31, 2019 A 9,000 $2.00 $18,000 $2.20 $19,800 B 6,000 3.00 18,000 3.55 21,300 C 4,000 5.00 20,000 5.40 21,600 Totals $56,000 $62,700 December 31, 2020 A 9,000 $2.00 $18,000 $2.60 $23,400 B 6,800 3.00 20,400 3.75 25,500 C 6,000 5.00 30,000 6.40 38,400 Totals $68,400 $87,300 December 31, 2021 A 8,000 $2.00 $16,000 $2.70 $21,600 B 8,000 3.00 24,000 4.00 32,000 C 6,000 5.00 30,000 6.20 37,200 Totals $70,000 $90,800 Instructions Compute the ending inventories under the dollar-value LIFO method for 2019, 2020, and 2021. The base period is January 1, 2019, and the beginning inventory cost at that date was $45,000. Compute indexes to two decimal places.
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Warmuplang Corporation showed the following costs for 2020 Warehouse depreciation P 300,000 Salaries of warehouse supervisor 200,000 Increase in RM inventory 20,000 Direct material purchases 120,000 Direct labor costs incurred 180,000 Variable selling costs 80,000 Question 1: Under the absorption costing, the total product costs should be: Question 2: if the company produced and sold 100,000 and 90,000 units, respectively during 2020. How much would be the difference in net income under absorption and variable costing?
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ABC Company has the following costs and expenses for the year December 31, 2020. Raw Materials, 1/1/2020 P40,000 Insurance, Factory P14,000 Raw Materials, 12/1/2020 P25,000 Property Taxes, Factory Building P6,000 Raw Materials Purchases P305,000 Sales Revenue P2,000,000 Work-in-Process, 1/1/2020 P60,000 Delivery Expenses P50,000 Work-in-Process, 12/1/2020 P40,000 Sales Commissions P100,000 Finished Goods, 1/1/2020 P120,000 Indirect Labor P55,000 Finished Goods, 12/31/2020 P110,000 Indirect Material P105,000 Direct Labor P400,000 Factory Machinery, Rent P25,000 Factory Manager’s Salary P25,000 Factory Utilities P55,000 Depreciation, Office Equipment P25,000 Administrative Expense P250,000 Requirement: Prepare a cost of goods manufactured schedule for ABC Company for 2020. Prepare cost of goods sold schedule for ABC Company for 2020. Prepare Income Statement for ABC Company.
Question 3Study the scenario and complete the questions that follow:Nonna Greco LimitedNonna Greco Limited manufactures and sells Italian HIP sunglasses. The following information relatesto January 2020:Units manufactured and sold: 500Income statement:RSales 261 500Less: Manufacturing costs 223 000Material 75 000Labour 50 000Manufacturing overheads (@ R20 per machine hour) 98 00038 500Less: Selling and administrative expenses (60% fixed) 17 500Net profit 21 000The following changes will come into effect on 1 February 2020: A sales price increase of 10%, resulting in a 5% decrease in sales volume. Due to negotiations with the labour union, the labour rate per hour will increase by 6%. It is expected that material costs will increase by 10%.The variable budget for manufacturing overheads indicates a total cost ofR94 400 at a capacity utilisation of 4 600 hours.Source: Hunde, T. (2020)Required:3.1 Calculate the total marginal income and marginal income per unit for the year ended 1…
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