DEF Co., which has only one product, has provided the following data concerning its most recent month of operations: Selling price Units in beginning inventory Units produced Units sold Units in ending inventory Variable costs per unit: Direct materials Direct labour Variable manufacturing overhead Variable selling and administrative Fixed costs: Fixed manufacturing overhead Fixed selling and administrative $130 0 7,400 7,100 80 $25 $45 $5 $6 $195,500 $105,500 Required: a) What is the unit product cost for the month under variable costing? b) What is the unit product cost for the month under absorption costing? c) Prepare an income statement for the month using the contribution format and the variable costing method. d) Prepare an income statement for the month using the absorption costing method. e) Reconcile the variable costing and absorption costing operating incomes for the month.
DEF Co., which has only one product, has provided the following data concerning its most recent month of operations: Selling price Units in beginning inventory Units produced Units sold Units in ending inventory Variable costs per unit: Direct materials Direct labour Variable manufacturing overhead Variable selling and administrative Fixed costs: Fixed manufacturing overhead Fixed selling and administrative $130 0 7,400 7,100 80 $25 $45 $5 $6 $195,500 $105,500 Required: a) What is the unit product cost for the month under variable costing? b) What is the unit product cost for the month under absorption costing? c) Prepare an income statement for the month using the contribution format and the variable costing method. d) Prepare an income statement for the month using the absorption costing method. e) Reconcile the variable costing and absorption costing operating incomes for the month.
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter18: Pricing And Profitability Analysis
Section: Chapter Questions
Problem 28P: The following information pertains to Vladamir, Inc., for last year: There are no work-in-process...
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VIEWStep 2 part a) Computation of unit product cost under variable costing
VIEWStep 3 part b) Computation of unit product cost under absorption costing
VIEWStep 4 Part c) Income statement under variable costing
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