A business operated at 100% of capacity during its first month and incurred the following costs: Production costs (20,000 units): Direct materials Direct labor Variable factory overhead Fixed factory overhead Operating expenses: Variable operating expenses Fixed operating expenses $178,400 225,500 259,700 102,100 a. $63,042 b. $88,493 c. $72,742 Od. $320,361 $121,200 44,600 $765,700 165,800 If 1,900 units remain unsold at the end of the month and sales total $1,189,000 for the month, the amount reported on the variable costing income statement would be operating income

A business operated at 100% of capacity during its first month and incurred the following costs: Production costs (20,000 units): Direct materials Direct labor Variable factory overhead Fixed factory overhead Operating expenses: Variable operating expenses Fixed operating expenses $178,400 225,500 259,700 102,100 a. $63,042 b. $88,493 c. $72,742 Od. $320,361 $121,200 44,600 $765,700 165,800 If 1,900 units remain unsold at the end of the month and sales total $1,189,000 for the month, the amount reported on the variable costing income statement would be operating income

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter5: Process Costing

Section: Chapter Questions

Problem 2PB: The following product costs are available for Kellee Company on the production of eyeglass frames:...

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Steeler Towel Company estimates its overhead to be $250,000. It expects to have 100,000 direct labor hours costing $2,500,000 in labor and utilizing 12,500 machine hours. Calculate the predetermined overhead rate using: A. Direct labor hours B. Direct labor dollars C. Machine hours
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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