1.a. Unit product cost [Refer working note 1] | $41 |
1.b. Absorption costing - Income statement | |
High Country, Inc. | |
Absorption Costing Income Statement | |
Sales [44,000 units x $79 per unit] | $3,476,000 |
Cost of goods Sold [Units sold x Unit product cost = 44,000 units x $41 per unit] | $1,804,000 |
Gross Margin [Sales - Cost of goods sold] | $1,672,000 |
Selling and administrative expenses [Variable cost + Fixed cost = (44,000 units x $3 per unit) + $565,000] | $697,000 |
Net operating income [Gross margin - Selling and administrative expenses] | $975,000 |
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2.a. Unit product cost [Refer working note 2] | $23 | |
2.b. Variable costing - Income statement | ||
High Country, Inc. | ||
Variable Costing Income Statement | ||
Sales [44,000 units x $79 per unit] | $3,476,000 | |
Variable Expenses | ||
Variable cost of goods sold [Units sold x Unit product cost = 44,000 units x $23 per unit] | $1,012,000 | |
Variable selling expenses [44,000 units x $3 per unit] | $132,000 | |
$1,144,000 | ||
Contribution Margin [Sales - Variable expenses] | $2,332,000 | |
Fixed expenses | ||
Fixed manufacturing overhead | $882,000 | |
Fixed selling and administrative expenses | $565,000 | |
$1,447,000 | ||
Net Operating Income [$2,332,000 - $1,447,000] | $885,000 |
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Working note 1 - Computation of unit Product cost as per absorption costing | |
Direct material cost per unit | $15 |
Direct labor cost per unit | $7 |
Variable manufacturing overhead cost per unit | $1 |
Fixed
manufacturing overhead cost per unit [Fixed manufacturing overhead cost ÷ Number of units produced = $882,000 ÷ 44,000 units] |
$18 |
Unit Product cost | $41 |
.
.
Working note 2 - Computation of unit Product cost as per variable costing | |
Direct material cost per unit | $15 |
Direct labor cost per unit | $7 |
Variable manufacturing overhead cost per unit | $1 |
Unit Product cost | $23 |
High Country, Inc., produces and sells many recreational products. The company has just opened a new...
High Country, Inc., produces and sells many recreational products. The company has just opened a new plant to produce a folding camp cot that will be marketed throughout the United States. The following cost and revenue data relate to May, the first month of the plant's operation: 49,000 44,000 85 Beginning inventory Units produced Units sold Selling price per unit Selling and administrative expenses: Variable per unit Fixed (per month) Manufacturing costs: Direct materials cost per unit Direct labor cost...
High Country, Inc., produces and sells many recreational products. The company has just opened a new plant to produce a folding camp cot that will be marketed throughout the United States. The following cost and revenue data relate to May, the first month of the plant's operation: 40,000 35,000 85 Beginning inventory Units produced Units sold Selling price per unit Selling and administrative expenses: Variable per unit Fixed (per month) Manufacturing costs: Direct materials cost per unit Direct labor cost...
High Country, Inc., produces and sells many recreational products. The company has just opened a new plant to produce a folding camp cot that will be marketed throughout the United States. The following cost and revenue data relate to May, the first month of the plant's operation: 0 49,000 44,000 75 Beginning inventory Units produced Units sold Selling price per unit Selling and administrative expenses : Variable per unit Fixed (per month) Manufacturing costs: Direct materials cost per unit Direct...
High Country, Inc., produces and sells many recreational products. The company has just opened a new plant to produce a folding camp cot that will be marketed throughout the United States. The following cost and revenue data relate to May, the first month of the plant’s operation: Beginning inventory 0 Units produced 47,000 Units sold 42,000 Selling price per unit $ 75 Selling and administrative expenses: Variable per unit $ 2 Fixed (per month) $ 565,000 Manufacturing costs: Direct materials...
High Country, Inc., produces and sells many recreational products. The company has just opened a new plant to produce a folding camp cot that will be marketed throughout the United States. The following cost and revenue data relate to May, the first month of the plant’s operation: Beginning inventory 0 Units produced 47,000 Units sold 42,000 Selling price per unit $ 77 Selling and administrative expenses: Variable per unit $ 4 Fixed (per month) $ 565,000 Manufacturing costs: Direct materials...
High Country, Inc., produces and sells many recreational products. The company has just opened a new plant to produce a folding camp cot that will be marketed throughout the United States. The following cost and revenue data relate to May, the first month of the plant's operation Beginning inventory Units produced 49,000 44,000 $79 Units solod Selling price per unit Selling and administrative expenses: Variable per unit Fixed per month Manufacturing costs: Direct materials cost per unit Direct labor cost...
High Country, Inc., produces and sells many recreational products. The company has just opened a new plant to produce a folding camp cot that will be marketed throughout the United States. The following cost and revenue data relate to May, the first month of the plant's operation: 39,000 34,000 to 79 Beginning inventory Units produced Units sold Selling price per unit Selling and administrative expenses: Variable per unit Fixed (per month) Manufacturing costs: Direct materials cost per unit Direct labor...
High Country, Inc., produces and sells many recreational products. The company has just opened a new plant to produce a folding camp cot that will be marketed throughout the United States. The following cost and revenue data relate to May, the first month of the plant's operation: 10,000 8,000 $75 Beginning inventory ......... Units produced .... Units sold .... Selling price per unit..... Selling and administrative expenses: Variable per unit .... Fixed (per month) ..... Manufacturing costs: Direct materials cost...
High Country, Inc., produces and sells many recreational products. The company has just opened a new plant to produce a folding camp cot that will be marketed throughout the United States. The following cost and revenue data relate to May, the first month of the plant's operation: Beginning inventory Units produced Units sold 0 37,000 32,000 $ Selling price per unit Selling and administrative expenses Variable per unit Fixed (per month) Manufacturing costs Direct materials cost per unit Direct labor...
High Country, Inc., produces and sells many recreational products. The company has just opened a new plant to produce a folding camp cot that will be marketed throughout the United States. The following cost and revenue data relate to May, the first month of the plant's operation: 0 10,000 8,000 75 $ Beginning inventory Units produced Units sold Selling price per unit Selling and administrative expenses : Variable per unit Fixed (per month) Manufacturing costs: Direct materials cost per unit...