Denton Company manufactures and sells a single product. Cost data for the product are given:
Variable costs per unit: | ||||
Direct materials | $ | 6 | ||
Direct labor | 9 | |||
Variable manufacturing overhead | 2 | |||
Variable selling and administrative | 2 | |||
Total variable cost per unit | $ | 19 | ||
Fixed costs per month: | ||||
Fixed manufacturing overhead | $ | 60,000 | ||
Fixed selling and administrative | 166,000 | |||
Total fixed cost per month | $ | 226,000 | ||
The product sells for $54 per unit. Production and sales data for July and August, the first two months of operations, follow:
Units Produced |
Units Sold |
|
July | 15,000 | 11,000 |
August | 15,000 | 19,000 |
The company’s Accounting Department has prepared the following absorption costing income statements for July and August:
July | August | ||||
Sales | $ | 594,000 | $ | 1,026,000 | |
Cost of goods sold | 231,000 | 399,000 | |||
Gross margin | 363,000 | 627,000 | |||
Selling and administrative expenses | 188,000 | 204,000 | |||
Net operating income | $ | 175,000 | $ | 423,000 | |
Required:
1. Determine the unit product cost under:
a. Absorption costing.
b. Variable costing.
2. Prepare variable costing income statements for July and August.
3. Reconcile the variable costing and absorption costing net operating incomes.
Determine the unit product cost under: (a) Absorption costing, (b) Variable costing.
|
Prepare variable costing income statements for July and August.
|
Reconcile the variable costing and absorption costing net operating incomes. (Enter any losses or deductions as a negative value.)
|
Denton Company manufactures and sells a single product. Cost data for the product are given: Variable...
Denton Company manufactures and sells a single product. Cost
data for the product are given:
Variable costs per unit:
Direct materials
$
4
Direct labor
10
Variable manufacturing overhead
3
Variable selling and administrative
1
Total variable cost per unit
$
18
Fixed costs per month:
Fixed manufacturing overhead
$
96,000
Fixed selling and administrative
163,000
Total fixed cost per month
$
259,000
The product sells for $53 per unit. Production and sales data
for July and August, the first...
Denton Company manufactures and sells a single product. Cost data for the product are given Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Total variable cost per unit Fixed costs per month: Fixed manufacturing overhead Fixed selling and administrative Total fixed cost per month $ 19 $ 108,000 169,000 $ 277,000 The product sells for $46 per unit. Production and sales data for July and August, the first two months of operations, follow....
Denton Company manufactures and sells a single product. Cost data for the product are given: MENN Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Total variable cost per unit Fixed costs per month: Fixed manufacturing overhead Fixed selling and administrative Total fixed cost per month $ 18 ve $ 60,000 172,000 $ 232,000 $ 23 The product sells for $54 per unit. Production and sales data for July and August, the first two...
Denton Company manufactures and sells a single product. Cost data for the product are given Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Total variable cost per unit Fixed costs per month: Fixed manufacturing overhead Fixed selling and administrative Total fixed cost per month $ 72,000 175,000 $ 247.000 The product sells for $54 per unit. Production and sales data for July and August, the first two months of operations, follow: Units Produced...
Denton Company manufactures and sells a single product. Cost data for the product are given: $ 4 Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Total variable cost per unit Fixed costs per month: Fixed manufacturing overhead Fixed selling and administrative Total fixed cost per month $ 23 $ 54,000 163,000 $ 217,000 The product sells for $48 per unit. Production and sales data for July and August, the first two months of...
Denton Company manufactures and sells a single product. Cost data for the product are given: $ 4 Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Total variable cost per unit Fixed costs per month: Fixed manufacturing overhead Fixed selling and administrative Total fixed cost per month $ 19 $ 120,000 175,000 $ 295,000 The product sells for $49 per unit. Production and sales data for July and August, the first two months of...
Denton Company manufactures and sells a single product. Cost data for the product are given: Variable costs per unit: Direct materials $ 6 Direct labor 10 Variable manufacturing overhead 3 Variable selling and administrative 1 Total variable cost per unit $ 20 Fixed costs per month: Fixed manufacturing overhead $ 45,000 Fixed selling and administrative 166,000 Total fixed cost per month $ 211,000 The product sells for $48 per unit. Production and sales data for July and August, the first...
MUI Denton Company manufactures and sells a single product. Cost data for the product are given: Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Total variable cost per unit Fixed costs per month Fixed manufacturing overhead Fixed selling and administrative Total fixed cost per month $ 72,000 175,000 $ 247,000 rences The product sells for $47 per unit. Production and sales data for July and August, the first two months of operations, follow....
Denton Company manufactures and sells a single product. Cost
data for the product are given:
Variable costs
per unit:
Direct
materials
$
4
Direct
labor
11
Variable
manufacturing overhead
3
Variable selling
and administrative
1
Total variable
cost per unit
$
19
Fixed costs per
month:
Fixed
manufacturing overhead
$
72,000
Fixed selling
and administrative
175,000
Total fixed cost
per month
$
247,000
The product sells for $48 per unit. Production and sales data
for July and August, the first...
Denton Company manufactures and sells a single product. Cost
data for the product are given:
Variable costs per unit:
Direct materials
$
4
Direct labor
10
Variable manufacturing overhead
3
Variable selling and administrative
2
Total variable cost per unit
$
19
Fixed costs per month:
Fixed manufacturing overhead
$
54,000
Fixed selling and administrative
175,000
Total fixed cost per month
$
229,000
The product sells for $54 per unit. Production and sales data
for July and August, the first...