Exercise 19-10 (Algo) Absorption costing income statement LO P2Hayek Bikes prepares the income statement under variable costing for its managerial reports, and it prepares the income statementunder absorption costing for external reporting. For its first month of operations, 325 bikes were produced and 215 were sold. Incomestatement information under variable costing follows.Sales (215 x $1,725)Variable cost of goods sold (215 x $625)Variable selling and administrative expenses (215 x $70)Contribution marginFixed overheadFixed selling and administrative expensesIncome$ 370,875134,37515,050221,45065,00075,000$ 81,450Prepare the company's income statement under absorption costing.HAYEK BIKESIncome Statement (Absorption Costing)0$0

The gross profit is calculated as the difference between the sales and cost of goods sold. The net…

Answered: Exercise 19-10 (Algo) Absorption…

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter7: Variable Costing For Management analysis

Section: Chapter Questions

Problem 1PB: Absorption and variable costing income statements During the first month of operations ended July...

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Absorption and variable costing income statements During the first month of operations ended July 31, YoSan Inc. manufactured 2,400 flat panel televisions, of which 2,000 were sold. Operating data for the month are summarized as follows: Instructions 1. Prepare an income statement based on the absorption costing concept. 2. Prepare an income statement based on the variable costing concept. 3. Explain the reason for the difference in the amount of operating income reported in (1) and (2).
Summarized data for Walrus Co. for its first year of operations are: A. Prepare an income statement under absorption costing B. Prepare an income statement under variable costing
Variable-Costing Income Statement Refer to the data for Osterman Company on the previous page. Required: 1. Calculate the cost of goods sold under variable costing. 2. Prepare an income statement using variable costing. Use the following information for Brief Exercises 3-23 and 3-24: During the most recent year, Osterman Company had the following data:
REQUIRED Prepare the Income Statement of Abbey Limited for the month ended 31 March 2023 using the following methods: 2.1 Absorption costing 2.2 Variable costing INFORMATION The following information was extracted from the accounting records of Abbey Limited for the month ended 31 March 2023: Inventory on 01 March 2023 Production Sales Selling price per unit Manufacturing costs: Fixed manufacturing overheads costs Direct materials cost per unit Direct labour cost per unit Variable manufacturing overheads costs per unit Marketing costs: Advertising Sales personnel's salaries and commission Delivery costs Administration costs: Salaries Other office costs Nil 50 000 units 40 000 units R200 R480 000 R40 R24 R16 R32 000 per month R36 000 per month plus 5% of sales R24 per unit sold R80 000 per month R32 000 per month plus R16 per unit sold
18 eBook Hayek Bikes prepares the income statement under variable costing for its managerial reports, and it prepares the income statement under absorption costing for external reporting. For its first month of operations, 425 bikes were produced and 255 were sold. Income statement information under variable costing follows. Sales (255 $1,800) Variable cost of goods sold (255 $675) Variable selling and administrative expenses (255 $65) Contribution margin Fixed overhead Fixed selling and administrative expenses Income Prepare the company's income statement under absorption costing. HAYEK BIKES Income Statement (Absorption Costing) 0 0 $ 459,000 172,125 16,575 270, 300 85,000 95,000 $ 90,300
Trend Reporting for Non-Value-Added Costs Cicleta Manufacturing has four activities: receiving materials, assembly, expediting products, and storing goods. Receiving and assembly are necessary activities; expediting and storing goods are unnecessary. The following data pertain to the four activities for the year ending 20x1 (actual price per unit of the activity driver is assumed to be equal to the standard price): Activity Activity Driver SQ AQ SP Receiving Receiving orders 12,000 24,000 $21 Assembly Labor hours 99,000 120,000 15 Expediting Orders expedited 0 8,000 50 Storing Number of units 0 16,000 7 Assume that at the beginning of 20x2, Cicleta trained the assembly workers in a new approach that had the objective of increasing the efficiency of the assembly process. Cicleta also began moving toward a JIT purchasing and manufacturing system. When JIT is fully implemented, the demand for expediting…
13 Hayek Bikes prepares the income statement under variable costing for its managerial reports, and it prepares the income statemes under absorption costing for external reporting. For Rs first month of operations, 350 bikes were produced and 225 were sold, 125 bikes in ending inventory. The income statement information under variable costing follows Bales (22501,7751 Variable product cost (2256400) Variable selling and administrative expenses (225 655) Contribution margin Fixed overhead cost Fixed selling and administrative expense Net Income 135,000 352,000 52,500 85,900 $ 114,500 1. Prepare this company's income statement for its first month of operations under absorption costing. 2. Fill in the blanks: Complete this question by entering your answers in the tabs below.
MC Qu. 8-30 Falisari Corporation has computed the following... Falisari Corporation has computed the following unit costs for the year just ended: Direct material used $ 22 Direct labor 19 Variable manufacturing overhead 37 Fixed manufacturing overhead 39 Variable selling and administrative cost 17 Fixed selling and administrative cost 30 Which of the following choices correctly depicts the per-unit cost of inventory under variable costing and absorption costing? Variable Costing Absorption Costing A. $ 78 $ 117 B. $ 78 $ 147 C. $ 95 $ 117 D. $ 95 $ 147 E. None of the answers is correct. Multiple Choice Choice A Choice B Choice C Choice D Choice E
Tracey Packaged Snax reports the following information for November: Units produced and sold Per unit revenue and costs: Sales revenue Direct materials costs Direct labor costs Variable manufacturing overhead Fixed manufacturing overhead (at 320,000 units) Variable marketing and administrative costs Fixed marketing and administrative costs (at 320,000 units) Required: a. Prepare a gross margin income statement. b. Prepare a contribution margin income statement. Complete this question by entering your ansivers in the tabs below. Required A Required B Prepare a contribution margin income statement. Contribution Margin Income Statement 320,000 $9.60 1.65 0.90 0.80 1.55 0.75 1.15
Absorption Statement Absorption costing does not distinguish between variable and fixed costs. All manufacturing costs are included in the cost of goods sold. Saxon, Inc.Absorption Costing Income StatementFor the Year Ended December 31 Sales $1,200,000 Cost of goods sold: Cost of goods manufactured $800,000 Ending inventory (200,000) Total cost of goods sold (600,000) Gross profit $600,000 Selling and administrative expenses (260,000) Operating income $340,000 Variable Statement Under variable costing, the cost of goods manufactured includes only variable manufacturing costs. This type of income statement includes a computation of manufacturing margin. Saxon, Inc.Variable Costing Income StatementFor the Year Ended December 31 Sales $1,200,000 Variable cost of goods sold: Variable cost of goods manufactured $560,000 Ending inventory (140,000) Total variable cost of goods sold (420,000) Manufacturing…
Absorption Statement Absorption costing does not distinguish between variable and fixed costs. All manufacturing costs are included in the cost of goods sold. Saxon, Inc.Absorption Costing Income StatementFor the Year Ended December 31 Sales $1,125,000 Cost of goods sold: Cost of goods manufactured $800,000 Ending inventory (200,000) Total cost of goods sold (600,000) Gross profit $525,000 Selling and administrative expenses (260,000) Operating income $265,000 Variable Statement Under variable costing, the cost of goods manufactured includes only variable manufacturing costs. This type of income statement includes a computation of manufacturing margin. Saxon, Inc.Variable Costing Income StatementFor the Year Ended December 31 Sales $1,125,000 Variable cost of goods sold: Variable cost of goods manufactured $560,000 Ending inventory (140,000) Total variable cost of goods sold (420,000) Manufacturing…
Income statements under absorption and variable costing Gallatin County Motors Inc. assembles and sells snowmobile engines. The company began operations on July 1 and operated at 100% of capacity during the first month. The following data summarize the results for July: Sales (4,500 units) Production costs (5,000 units): Direct materials Direct labor Variable factory overhead Fixed factory overhead Selling and administrative expenses: Variable selling and administrative expenses Fixed selling and administrative expenses 97,500 This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below. X Open spreadsheet Cull-tim C... MALA TI $2,880,000 $1,376,000 591,500 96,500 151,500 2,215,500 $68,700 28,800 a. Prepare an income statement according to the absorption costing concept.

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