Module 4 Variable Costi Connect CSecure httpsnewconnectmhe

× Module 4: Variable Costi \", Connect CSecure https://newconnect.mheducation.co ?: Lesson 4 Homework Sovsd Help Seve & Exit Submit Check my work 4 High Country, Inc., procluces and sells many recreatlonal products. The company has lust opened a new plant to procluce a folding carmp cot that will be marketed throughout the United Ststes. The following cost and revernue data relate to May, the first month of the plants operation 2.3 Beginning inventory Units prcduced nits old Sclling pricc per unit Sclling and adninistrativs cxpensc 36,980 31,980 05 ariable per unit Hixod (par ronth) 539, Manutacturing costs: 1 rùct \"aterials cost per unit Dirert 1ahor cost perunit Variable nanufacturing overhead cost per unit ?ixed nanufscturinu Uverhead ?ost (per north) Print 576,800 Management is exious to assess the profitebility of the new carp col during the month of May Required: 1. Assume he the cormpeny uses absorpon tng. a. Determine the unit product cost b. Prepare an income statement for May 2. Assurriethat the company uses variable costing. a. Determine the unit product cost b. Prepare a contribution format income statement for May Complete this question hy entering your answers in the tahle helow. Req 1A Heq 1H Req 2A Determine the unit pradurt coest. Assume that the campany uses abseption casting K Pre Next> 1:04 PM O Type here to search

Solution

Construct The Absorption Costing Unit Product Cost Direct Material 14 Direct labour 6 Variable Manufacturing overheads 4 Fixed Manufacturing overheads 16.00 (576000 /36000 units) Absorption costing unit prroduct cost 40.00 Construct the Absorption Costing Income Statement Under FIFO Year 1 Sales $2,635,000 Cost of Goods sold 1240000 Gross Margin $1,395,000 Selling and distribution expense 652,000 Net operating income 743,000 Compute the Variable costing Unit Product cost Year 1 Direct Material 14 Direct labour 6 Variable Manufacturing overheads 4 Variable costing unit prroduct cost 24 Construct The Variable Costing Income Statement under FIFO Sales 2,635,000 Less: Variable cost    variable cost of goods sold 744,000    Variable selling expense 93,000 837,000 Contribution margin 1,798,000 Fixed expense:    Fixed Manufacturing overheads 576,000    Fixed selling expense 559,000 Net operating Income 663,000