The service department at Major Motors sold $48,000 in service last month. They had direct labor costs of $16,500 to pay their technicians. They were not given credit for any parts sales or expenses because that was the responsibility of their separate parts department. They were, however, allocated $29,250 in fixed expenses. What was Major Motors net profit

Ross Corporation manufactures and sells one product. The following information pertains to the company's first year of operations: Variable costs per unit: Direct materials $81 Fixed costs per year Direct labor $1,008,000 Fixed manufacturing overhead $2,520,000 Fixed selling and administrative $1,440,000 The company does not have any variable manufacturing overhead costs or variable selling and administrative costs. During its first year of operations, the company produced 36,000 units and sold 30,000 units. There was no ending work-in-process inventory. The company's only product is sold for $251 per unit. 9.1 What is the unit product cost under super-variable costing? 9.2 What is the net operating income under super-variable costing? 9.3 Assume that the company uses a variable costing system that assigns $28 of direct labor cost to each unit that is produced. How much higher or lower is variable costing income compared to that under super-variable costing? 9.4 Assume that the company…

Johnson Company estimates that its production workers will work 88,400 direct labor hours to produce 9,170 units during the upcoming period and that overhead costs will amount to $1,091,230. During the year, its manufacturing employees actually worked 100,000 direct labor hours to produce 10,000 units and incurred $1,100,000 of overhead costs. Because the goods made by Johnson are homogeneous (that is, they are identical), the company has decided it makes sense to use number of units as the allocation base for overhead. Based on this information the predetermined overhead rate is: Multiple Choice $11.00 per direct labor hour. $129.00 per unit. $119.00 per unit.

Wet Pets Inc. makes 100-gallon plexiglass aquariums. They reported the following financial information for last year: Direct labor: 7,200 hours @ $20 per hr. Production manager salary: $60,000 Factory rent: $28,800 Equipment maintenance: $12,000 (considered a variable expense) Equipment depreciation: $12,000 Production for the year: 12,000 units Total Revenue: $1,200,000 Total aquariums sold during the period: 10,000 units Operating Income under absorption costing (after non-production expenses): $244,800 Assume that the fixed costs were the same on a per-unit basis during the prior period. What would Operating Income be under variable costing? (Round per-unit costs to the nearest cent.) Select one: O a. $228,000 b. $226,000 c. $261,600 d. $263,592 e. None of these options are correct.

Patrick’s Water Pets Inc. makes 100-gallon plexiglass aquariums. They reported the following financial information for last year: Direct labor: 4,200 hours @ $20 per hr. Production manager salary: $35,000 Factory rent: $16,800 Equipment maintenance: $7,000 (considered a variable expense) Equipment depreciation: $7,000 Production for the year: 12,000 units Total Revenue: $700,000 Total aquariums sold during the period: 10,000 units Operating Income under absorption costing (after non-production expenses): $142,800 Assume that the fixed costs were the same on a per-unit basis during the prior period.What would Operating Income be under absorption costing? (Round per-unit costs to the nearest cent.) Select one: a. $133,000 b. $153,760 c. None of these options are correct. d. $131,840 e. $152,600

Product J is one of the many products manufactured and sold by Gooble Company. An income statement by product line for the past year indicated a net loss for Product J of $7,250. This net loss resulted from sales of $265,000, cost of goods sold of $186,500, and operating expenses of $85,750. It is estimated that 30% of the cost of goods sold represents fixed factory overhead costs and that 40% of the operating expense is fixed. If Product J is retained, the revenue, costs, and expenses are not expected to change significantly from those of the current year. However, because of the net loss, management is considering the elimination of the unprofitable endeavor. Because of the large number of products manufactured, the total fixed costs and expenses are not expected to decline significantly if Product J is discontinued. Prepare a differential analysis report, dated February 8 of the current year, on the proposal to discontinue Product J. Gooble Company Proposal to Discontinue Product J…

Sawaya Co., Ltd., of Japan is a manufacturing company whose total factory overhead costs fluctuate considerably from year to year according to increases and decreases in the number of direct labor-hours worked in the factory. Total factory overhead costs at high and low levels of activity for recent years are given below: Direct Labor Hours 61,000 Total Factory Overhead Cost 16,625,000 14,000,000 The factory overhead costs above consist of indirect materials, rent, and maintenance. The company has analyzed these costs at the 61000 hour level of activity as follows: Indirect Materials (Variable) Rent (Fixed) Maintenance (Mixed) 1,998,000 Total Factory overheads Cost 14,000,000 To have data available for planning, the company wants to break down the maintenance cost into its variable and fixed cost elements 90,000 5,002,000 7,000,000 Required: 1. Estimate how much of the $16,625,000 factory overhead cost at the high level of activity consists of maintenance cost. (Hint: To do this, it…

Regular Company produces audio equipment, specifically headphones and speakers. A new CEO has just been hired and announces a new policy that if a product cannot earn a markup of at least 25 percent, it will be dropped. The markup is computed as product gross profit divided by reported product cost. Manufacturing overhead for year 1 totaled $996,000. Overhead is allocated to products based on direct materials cost. Data for year 1 show the following:   Headphones Speakers Sales revenue $ 2,247,640 $ 2,141,940 Direct materials 730,000 930,000 Direct labor 492,000 252,000 Required: a-1. Calculate the markup for both headphones and speakers. a-2. Based on the CFO's new policy, which of the two products should be dropped? b. Regardless of your answer in requirement (a), the CFO decides at the beginning of year 2 to drop the speakers from the product line. The company cost analyst estimates that overhead without the speaker line will be $630,000. The revenue and costs for…

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A corporation makes several products. Because of a recent lack of skilled workers, the corporation has had a shortage of available labor hours. The following per unit data pertains to the related products: Selling price Variable cost Labor hours required Multiple Choice $12,000 The company only has 1,800 labor hours available next month. The company can only sell 800 units of each product a month. What is the maximum amount of contribution margin that it can generate next month? $19,000 $19,600 LO $30 $20 1 $19,800 ES $80 $40 6 CH $42 $20 2