Question

Help Se Homework for Chapter 6 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 dota relate to May, the first month of the plant's operation: Beginning inventory Units produced Units sold Selling price per unit Selling and adninistrative expenses 18,888 8,880 75 points Variable per unit Fixed (per month) eBook Print Reference s 280,8ee Manufacturing costs: Direct materials cost per unit Direct labor cost per unit Variable manufacturing overhead cost per unit Fixed manufacturing overhead cost (per month) 20 109,88e Management is anxious to assess the profitability of the new camp cot during the month of Mey Required: 1. Assume that the company uses absorption costing a Determine the unit product cost b. Prepare an income statement for Mey 2 Assume that the company uses variable costing o. Determine the unit product cost b. Prepare。contribution format income statement for May Complete this question by entering your answers in the table below. Type here to search DOLL

Answer 1

ulation of Product ome Statement Absorption Variable Costing Costing Absorption Costing Variable Cost Material Labour ariable Manufacturing O Fixed Manufacturing Overhead ($100,000 / 10,000 $10) $20.0O$20.00 $8.00 8.00 2.00 2.00 Sales Less: Cost Of Goods Sold Opening Inventory Add:Cost of Goods Manufactured Goods Available for sale Less: Ending Inventory 8000 X $75 600,000.00 Sales Less: Cost Of Goods Sold Opeiing Inventory Add Cost of Goods Manufactured Goods Available for sale Less: Ending Inventory [ 8000 X $75) SG00,000.00 verhead2 10.00 $ [ 10000 X $401 10000 x $30S 300,000.00 5 300,000.00 5 60,000.00 240,000.00 400,000.00 5 400,000.00 540.00 $ 30.00 2000 X $40)$80,000.00 $320,000.00 (2000 x $30) ariable cost of goods sold Variable Selling&Admist. Expense Contribution Margin Less: Flxed Expense Flxed manufacturing overhead Fixed selling and administrative expenses Net Operating Income $280,000.00 8000 X $6 S 48,000.00 $288,000.00 5312,000.00 Gress Profit Less: Selling& Admist. Expense Variable Selling& Admist. Expense Fixed Selling& Admist. Expense Note: Selling and administrative cost are period cost and are not relevent in the com putation of unit product cost (8000 X $6 5 48,000.00 5 200,000.00 $248,000.00 100,000.00 200,000.00 $300,000.00 Net Operating Income 32,000.0o 12,000.00