HuIc CUsting to cost units in the Finished omputations to support your answer. Assullle ulal he coOmpany wishes to prepare financial statements for the year to issue to its stockholders. Is the $72,000 figure for Finished Goods inventory the correct amount to use on thhese 2. a. statements for external reporting purposes? Explain. the b. At what dollar amount should the 3.000 units be carried in the inventory for externar reporting purposes? P, EXERCISE 6-14 Variable Costing Unit Product Cost and Income Statement; Break-Even [L06-1, LO6-2] Chuck Wagon Grills, Inc., makes a sells for $210. Data for last year's operations follow: single product-a handmade specialty barbecue grill that it Units in beginning inventory Units produced 20,000 Units sold 19,000 Units in ending inventory 1,000 Variable costs per unit: Direct materials $ 50 Direct labor 80 Variable manufacturing overhead ..... Variable selling and administrative ... .. 20 10 Total variable cost per unit .. $160 Fixed costs: $700,000 Fixed manufacturing overhead .. .. Fixed selling and administrative 285,000 $985,000 Total fixed costs . . Required: 1. Assume that the company uses variable costing. Compute the unit product cost for one barbe- cue grill. 2. Assume that the company uses variable costing. Prepare a contribution format income state- ment for the year. 3. What is the company's break-even point in terms of the number of barbecue grills sold?
HuIc CUsting to cost units in the Finished omputations to support your answer. Assullle ulal he coOmpany wishes to prepare financial statements for the year to issue to its stockholders. Is the $72,000 figure for Finished Goods inventory the correct amount to use on thhese 2. a. statements for external reporting purposes? Explain. the b. At what dollar amount should the 3.000 units be carried in the inventory for externar reporting purposes? P, EXERCISE 6-14 Variable Costing Unit Product Cost and Income Statement; Break-Even [L06-1, LO6-2] Chuck Wagon Grills, Inc., makes a sells for $210. Data for last year's operations follow: single product-a handmade specialty barbecue grill that it Units in beginning inventory Units produced 20,000 Units sold 19,000 Units in ending inventory 1,000 Variable costs per unit: Direct materials $ 50 Direct labor 80 Variable manufacturing overhead ..... Variable selling and administrative ... .. 20 10 Total variable cost per unit .. $160 Fixed costs: $700,000 Fixed manufacturing overhead .. .. Fixed selling and administrative 285,000 $985,000 Total fixed costs . . Required: 1. Assume that the company uses variable costing. Compute the unit product cost for one barbe- cue grill. 2. Assume that the company uses variable costing. Prepare a contribution format income state- ment for the year. 3. What is the company's break-even point in terms of the number of barbecue grills sold?
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter6: Cost Of Goods Sold And Inventory
Section: Chapter Questions
Problem 69BPSB
Related questions
Question
6-14
![HuIc CUsting to cost units in the Finished
omputations to support your answer.
Assullle ulal he coOmpany wishes to prepare financial statements for the year to issue to its
stockholders.
Is the $72,000 figure for Finished Goods inventory the correct amount to use on thhese
2.
a.
statements for external reporting purposes? Explain.
the
b.
At what dollar amount should the 3.000 units be carried in the inventory for externar
reporting purposes?
P,
EXERCISE 6-14 Variable Costing Unit Product Cost and Income Statement; Break-Even [L06-1, LO6-2]
Chuck Wagon Grills, Inc., makes a
sells for $210. Data for last year's operations follow:
single product-a handmade specialty barbecue grill that it
Units in beginning inventory
Units produced
20,000
Units sold
19,000
Units in ending inventory
1,000
Variable costs per unit:
Direct materials
$ 50
Direct labor
80
Variable manufacturing overhead .....
Variable selling and administrative ... ..
20
10
Total variable cost per unit ..
$160
Fixed costs:
$700,000
Fixed manufacturing overhead .. ..
Fixed selling and administrative
285,000
$985,000
Total fixed costs . .
Required:
1. Assume that the company uses variable costing. Compute the unit product cost for one barbe-
cue grill.
2. Assume that the company uses variable costing. Prepare a contribution format income state-
ment for the year.
3. What is the company's break-even point in terms of the number of barbecue grills sold?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F85e39e9b-3b6a-4fb6-8406-b63a567ff03b%2Fabe2f47a-b9e3-4205-8f31-bf4e8938e976%2Fnpdpqt4.jpeg&w=3840&q=75)
Transcribed Image Text:HuIc CUsting to cost units in the Finished
omputations to support your answer.
Assullle ulal he coOmpany wishes to prepare financial statements for the year to issue to its
stockholders.
Is the $72,000 figure for Finished Goods inventory the correct amount to use on thhese
2.
a.
statements for external reporting purposes? Explain.
the
b.
At what dollar amount should the 3.000 units be carried in the inventory for externar
reporting purposes?
P,
EXERCISE 6-14 Variable Costing Unit Product Cost and Income Statement; Break-Even [L06-1, LO6-2]
Chuck Wagon Grills, Inc., makes a
sells for $210. Data for last year's operations follow:
single product-a handmade specialty barbecue grill that it
Units in beginning inventory
Units produced
20,000
Units sold
19,000
Units in ending inventory
1,000
Variable costs per unit:
Direct materials
$ 50
Direct labor
80
Variable manufacturing overhead .....
Variable selling and administrative ... ..
20
10
Total variable cost per unit ..
$160
Fixed costs:
$700,000
Fixed manufacturing overhead .. ..
Fixed selling and administrative
285,000
$985,000
Total fixed costs . .
Required:
1. Assume that the company uses variable costing. Compute the unit product cost for one barbe-
cue grill.
2. Assume that the company uses variable costing. Prepare a contribution format income state-
ment for the year.
3. What is the company's break-even point in terms of the number of barbecue grills sold?
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