6-339
126.
Elliot Corporation, which has only one product, has provided the following data concerning
its most recent month of operations:
Selling price
$112
Units in beginning inventory
0
Units produced
4,900
Units sold
4,500
Units in ending inventory
400
Variable costs per unit:
Direct materials
$19
Direct labor
$45
Variable manufacturing overhead
$6
Variable selling and administrative
$9
Fixed costs:
Fixed manufacturing overhead
$117,600
Fixed selling and administrative
$22,500
$19
What is the net operating income for the month under variable costing?
127.
Elliot Corporation, which has only one product, has provided the following data concerning
its most recent month of operations:
Selling price
$112
Units in beginning inventory
0
Units produced
4,900
Units sold
4,500
Units in ending inventory
400
Variable costs per unit:
Direct materials
$19
Direct labor
$45
Variable manufacturing overhead
$6
Variable selling and administrative
$9
Fixed costs:
Fixed manufacturing overhead
$117,600
Fixed selling and administrative
$22,500
What is the net operating income for the month under absorption costing?
Direct materials
Direct labor
6-342
128.
Iancu Corporation, which has only one product, has provided the following data concerning
its most recent month of operations:
Selling price
$149
Units in beginning inventory
0
Units produced
4,200
Units sold
3,900
Units in ending inventory
300
Variable costs per unit:
Direct materials
$27
Direct labor
$46
Variable manufacturing overhead
$5
Variable selling and administrative
$9
Fixed costs:
Fixed manufacturing overhead
$155,400
Fixed selling and administrative
$70,200
What is the unit product cost for the month under variable costing?
Direct materials
Direct labor
Variable manufacturing overhead
6-344
6-345
129.
Iancu Corporation, which has only one product, has provided the following data concerning
its most recent month of operations:
Selling price
$149
Units in beginning inventory
0
Units produced
4,200
Units sold
3,900
Units in ending inventory
300
Variable costs per unit:
Direct materials
$27
Direct labor
$46
Variable manufacturing overhead
$5
Variable selling and administrative
$9
Fixed costs:
Fixed manufacturing overhead
$155,400
Fixed selling and administrative
$70,200
$27
What is the net operating income for the month under variable costing?
6-347
130.
Yankee Corporation manufactures a single product. The company has the following cost
structure:
Variable costs per unit:
Production
$4
Selling and administrative
$1
Fixed costs in total:
Production
$12,000
Selling and administrative
$8,000
Last year, 4,000 units were produced and 3,500 units were sold. There were no beginning
inventories.
Under variable costing, the unit product cost would be:
131.
Yankee Corporation manufactures a single product. The company has the following cost
structure:
Variable costs per unit:
Production
$4
Selling and administrative
$1
Fixed costs in total:
Production
$12,000
Selling and administrative
$8,000
Last year, 4,000 units were produced and 3,500 units were sold. There were no beginning
inventories.
The carrying value on the balance sheet of the ending finished goods inventory under
variable costing would be:
6-349
6-350
132.
Yankee Corporation manufactures a single product. The company has the following cost
structure:
Variable costs per unit:
Production
$4
Selling and administrative
$1
Fixed costs in total:
Production
$12,000
Selling and administrative
$8,000
Variable production cost per unit
Absorption costing unit product cost (a)
Units sold (b)
Last year, 4,000 units were produced and 3,500 units were sold. There were no beginning
inventories.
Under absorption costing, the cost of goods sold for the year would be:
6-351
133.
Cutterski Corporation manufactures a propeller. Shown below is Cutterski’s cost structure:
Variable cost per propeller
Total fixed cost for the year
Manufacturing cost
$114
$810,000
Selling and administrative expense
$20
$243,000
In its first year of operations, Cutterski produced 60,000 propellers but only sold 54,000.
What is the total cost that would be assigned to Cutterski’s finished goods inventory at
the end of the first year of operations under variable costing?
134.
Cutterski Corporation manufactures a propeller. Shown below is Cutterski’s cost structure:
Variable cost per
propeller
Total fixed cost
for the year
Manufacturing cost
$114
$810,000
Selling and administrative expense
$20
$243,000
In its first year of operations, Cutterski produced 60,000 propellers but only sold 54,000.
What would Cutterski report as its cost of goods sold under absorption costing?
135.
Cutterski Corporation manufactures a propeller. Shown below is Cutterski’s cost structure:
Variable
cost per
propeller
Total fixed cost for the year
Manufacturing
cost
$114
$810,000
Selling and
administrative
expense
$20
$243,000
In its first year of operations, Cutterski produced 60,000 propellers but only sold 54,000.
Which costing method (variable or absorption) will generate a higher net operating
income in Cutterski’s first year of operations and by how much?
6-354
6-355
136.
Harris Corporation produces a single product. Last year, Harris manufactured 17,000 units
and sold 13,000 units. Production costs for the year were as follows:
Direct materials
$153,000
Direct labor
$110,500
Variable manufacturing overhead
$204,000
Fixed manufacturing overhead
$255,000
Total variable expenses
Sales were $780,000 for the year, variable selling and administrative expenses were
$88,400, and fixed selling and administrative expenses were $170,000. There was no
beginning inventory. Assume that direct labor is a variable cost.
The contribution margin per unit was:
6-356
137.
Harris Corporation produces a single product. Last year, Harris manufactured 17,000 units
and sold 13,000 units. Production costs for the year were as follows:
Direct materials
$153,000
Direct labor
$110,500
Variable manufacturing overhead
$204,000
Fixed manufacturing overhead
$255,000
Absorption costing unit product cost (a)
Units in ending inventory (b)
Value of ending inventory under absorption costing (a) × (b)
Sales were $780,000 for the year, variable selling and administrative expenses were
$88,400, and fixed selling and administrative expenses were $170,000. There was no
beginning inventory. Assume that direct labor is a variable cost.
Under absorption costing, the ending inventory for the year would be valued at:
6-357
6-358
138.
Harris Corporation produces a single product. Last year, Harris manufactured 17,000 units
and sold 13,000 units. Production costs for the year were as follows:
Direct materials
$153,000
Direct labor
$110,500
Variable manufacturing overhead
$204,000
Fixed manufacturing overhead
$255,000
Sales were $780,000 for the year, variable selling and administrative expenses were
$88,400, and fixed selling and administrative expenses were $170,000. There was no
beginning inventory. Assume that direct labor is a variable cost.
Under variable costing, the company’s net operating income for the year would be: