Question

Dattilio Corporation manufactures and sells one product. The following information pertains to the company's first year of operations: $ 88 Variable cost per unit: Direct materials Fixed costs per year: Direct labor Fixed manufacturing overhead Fixed selling and administrative expenses $1,317,900 $2,349,300 $1,824,900 The company does not have any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 57,300 units and sold 55,300 units. The company's only product is sold for $254 per unit. Required: a. Assume the company uses super-variable costing. Compute the unit product cost for the year. b. Assume the company uses super-variable costing. Prepare an income statement for the year. Complete this question by entering your answers in the tabs below. Required A Required B Assume the company uses super-variable costing. Compute the unit product cost for the year. Unit product cost

Answer 1

Ans. A	Super variable costing product cost per unit includes only direct materials cost per unit.
	Unit product cost =   $88   per unit
Ans. B	DATTILLIO CORPORATION
	Super Variable Costing Income Statement
	PARTICULARS		Amount
	Sales		$14,046,200
	Less: Variable cost of goods sold		$4,866,400
	Contribution margin		$9,179,800
	Less: Fixed costs:
	Direct labor	$1,317,900
	Fixed manufacturing overhead	$2,349,300
	Fixed selling and administrative expenses	$1,824,900
	Total fixed cost		$5,492,100
	Net operating income		$3,687,700
	*Calculations:
	Sales     =    Units sold * Selling price
	55,300 * $254
	$14,046,200
	Variable cost of goods sold = Units sold * Unit product cost
	55,300 * $88
	$4,866,400