Farron Company, which has only one product, has provided the following data concerning its most recent month of operations:$\begin{array}{|l|r|} \hline \text { Selling price } & \$ 92 \\ \hline \text { Units in beginning inventory } & 0 \\ \hline \text { Units produced } & 8,700 \\ \hline \text { Units sold } & 8,300 \\ \hline \text { Units in ending inventory } & 400 \\ \hline \text { Variable costs per unit: } & \\\hline \text { Direct materials } & \$ 13 \\ \hline \text { Direct labour } & \$ 55 \\ \hline \text { Variable manufacturing overhead } & \$ 1 \\ \hline \text { Variable selling and administrative } & \$ 5 \\ \hline \text { Fixed costs: } & \\ \hline \text { Fixed manufacturing overhead } & \$ 130,500 \\ \hline \text { Fixed selling and administrative } & \$ 8,300 \\ \hline \end{array}$ -What was the unit product cost for the month under variable costing?

A) $69. B) $74. C) $84. D) $89. A) $69. B) $74. C) $84. D) $89.

Jarvix Company, which has only one product, has provided the following data concerning its most recent month of operations: $\begin{array}{l|r|} \hline \text { Selling price } & \$ 111 \\ \hline \text { Units in beginning inventory } & 0 \\ \hline \text { Units produced } & 8,800 \\ \hline \text { Units sold } & 8,900 \\ \hline \text { Variable costs per unit: } & \\ \hline \text { Direct materials } & \$ 34 \\\hline \text { Direct labour } & \$ 37 \\ \hline \text { Variable manufacturing overhead } & \$ 3 \\ \hline \text { Variable selling and administrative } & \$ 9 \\ \hline \text { Fixed costs: } &\\ \hline \text { Fixed manufacturing overhead } & \$ 61,600 \\ \hline \text { Fixed selling and administrative } & \$ 169,100 \\ \hline \end{array}$The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. -What was the amount of fixed overhead released for the month under absorption costing?

A) $0. B) $2,100. C) $2,800. D) $61,600. A) $0. B) $2,100. C) $2,800. D) $61,600.

Iancu Company, which has only one product, has provided the following data concerning its most recent month of operations: $\begin{array} { | l | r | } \hline \text { Selling price } & \$ 149 \\ \hline \text { Units in beginning inventory } & 0 \\ \hline \text { Units produced } & 4,200 \\ \hline \text { Units sold } & 3,900 \\ \hline \text { Units in ending inventory } & 300 \\ \hline \text { Variable costs per unit: } & \\ \hline \text { Direct materials } & \$ 27 \\ \hline \text { Direct labour } & \$ 46 \\ \hline \text { Variable manufacturing overhead } & \$ 5 \\ \hline \text { Variable selling and administrative } & \$ 9 \\ \hline \text { Fixed costs: } & \\ \hline \text { Fixed manufacturing overhead } & \$ 155,400 \\ \hline \text { Fixed selling and administrative } &\$ 70,200 \\ \hline \end{array}$ -What was the operating income (loss)for the month under variable costing?

A) ($7,200). B) $11,100. C) $16,200. D) $27,300. A) ($7,200). B) $11,100. C) $16,200. D) $27,300.

Farron Company, which has only one product, has provided the following data concerning its most recent month of operations:$\begin{array}{|l|r|} \hline \text { Selling price } & \$ 92 \\ \hline \text { Units in beginning inventory } & 0 \\ \hline \text { Units produced } & 8,700 \\ \hline \text { Units sold } & 8,300 \\ \hline \text { Units in ending inventory } & 400 \\ \hline \text { Variable costs per unit: } & \\\hline \text { Direct materials } & \$ 13 \\ \hline \text { Direct labour } & \$ 55 \\ \hline \text { Variable manufacturing overhead } & \$ 1 \\ \hline \text { Variable selling and administrative } & \$ 5 \\ \hline \text { Fixed costs: } & \\ \hline \text { Fixed manufacturing overhead } & \$ 130,500 \\ \hline \text { Fixed selling and administrative } & \$ 8,300 \\ \hline \end{array}$ -What was the operating income (loss)for the month under absorption costing?

A) ($17,000). B) $6,000. C) $10,600. D) $16,600. A) ($17,000). B) $6,000. C) $10,600. D) $16,600.

During the past year, Carr Company manufactured 25,000 units and sold 20,000 units. Production costs for the year were as follows: $\begin{array} { | l | r | } \hline \text { Direct materials } & \$ 180,000 \\ \hline \text { Direct labour } & 120,000 \\ \hline \text { Variable manufacturing overhead } & 210,000 \\ \hline \text { Fixed manufacturing overhead } & 250,000 \\ \hline \end{array}$Total sales were $850,000, total variable selling expenses were $110,000, and total fixed selling and administrative expenses were $170,000. There were no units in beginning inventory. Assume that direct labour is a variable cost. Do not round intermediate calculations. -Under absorption costing,what was the value of the ending inventory for the year?

A) $152,000. B) $179,500. C) $213,500. D) $222,000. A) $152,000. B) $179,500. C) $213,500. D) $222,000.

Last year, Walsh Company manufactured 25,000 units and sold 22,000 units. Production costs were as follows: $\begin{array}{|l|r|} \hline \text { Direct materials } & \$ 100,000 \\ \hline \text { Direct labour } & 75,000 \\ \hline \text { Variable manufacturing overhead } & 50,000 \\ \hline \text { Fixed manufacturing overhead } & 75,000 \\ \hline \end{array}$Total sales were $440,000, total variable selling and administrative expenses were $110,000, and total fixed selling and administrative expenses were $45,000. There was no beginning inventory. Assume that direct labour is a variable cost. -What was the contribution margin per unit?

A) $6.00. B) $8.00. C) $11.00. D) $15.00. A) $6.00. B) $8.00. C) $11.00. D) $15.00.

Last year, Harris Company manufactured 17,000 units and sold 13,000 units. Production costs for the year were as follows: $\begin{array} { | l | r | } \hline \text { Direct materials } & \$ 153,000 \\ \hline \text { Direct labour } & 110,500 \\ \hline \text { Variable manufacturing overhead } & 204,000 \\ \hline \text { Fixed manufacturing overhead } & 255,000 \\ \hline \end{array}$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 labour is a variable cost. -What was the contribution margin per unit? Do not round intermediate calculations.

A) $17.50. B) $25.70. C) $27.50. D) $32.50. A) $17.50. B) $25.70. C) $27.50. D) $32.50.

Khanam Company, which has only one product, has provided the following data concerning its most recent month of operations: $\begin{array}{|l|r|} \hline \text { Selling price } & \$ 97 \\ \hline \text { Units in beginning inventory } & 500 \\ \hline \text { Units produced } & 8,400 \\ \hline \text { Units in ending inventory } & 400 \\ \hline \text { Variable costs per unit: } & \\\hline \text { Direct materials } & \$ 20 \\ \hline \text { Direct labour } & \$ 37 \\ \hline \text { Variable manufacturing overhead } & \$ 1 \\ \hline \text { Variable selling and administrative } & \$ 11 \\\hline \text { Fixed costs: } & \\ \hline \text { Fixed manufacturing overhead } & \$ 67,200 \\ \hline \text { Fixed selling and administrative } & \$ 161,500 \\ \hline \end{array}$The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. -What is the operating income for the month under absorption costing?

A) $3,200. B) $8,500. C) $9,300. D) $15,100. A) $3,200. B) $8,500. C) $9,300. D) $15,100.

O'Leary Company manufactures a single product that it sells for $\$ 29$ per unit. The company has the following cost structure: $\begin{array}{|l|r|} \hline \text { Variable costs per unit: } & \\ \hline \text { Manufacturing } & \$ 11 \\ \hline \text { Selling and administrative } & \$ 4 \\ \hline \text { Fixed costs in total } & \\ \hline \text { Manufacturing } & \$ 80,000 \\ \hline \text { Selling and administrative } & \$ 58,000 \\ \hline \end{array}$ There were no units in beginning inventory. During the year, 16,000 units were produced and 14,000 units were sold. -What was the company's operating income for the year under variable costing?

A) $58,000. B) $60,000. C) $69,000. D) $81,000. A) $58,000. B) $60,000. C) $69,000. D) $81,000.

Khanam Company, which has only one product, has provided the following data concerning its most recent month of operations: $\begin{array}{|l|r|} \hline \text { Selling price } & \$ 97 \\ \hline \text { Units in beginning inventory } & 500 \\ \hline \text { Units produced } & 8,400 \\ \hline \text { Units in ending inventory } & 400 \\ \hline \text { Variable costs per unit: } & \\\hline \text { Direct materials } & \$ 20 \\ \hline \text { Direct labour } & \$ 37 \\ \hline \text { Variable manufacturing overhead } & \$ 1 \\ \hline \text { Variable selling and administrative } & \$ 11 \\\hline \text { Fixed costs: } & \\ \hline \text { Fixed manufacturing overhead } & \$ 67,200 \\ \hline \text { Fixed selling and administrative } & \$ 161,500 \\ \hline \end{array}$The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. -What was the operating income for the month under variable costing?

A) $3,200. B) $8,500. C) $9,300. D) $15,100. A) $3,200. B) $8,500. C) $9,300. D) $15,100.

Erie Company manufactures a single product. Assume the following data for the year just completed: $\begin{array}{|l|r|} \hline \text { Variable costs per unit: } & \\ \hline \text { Manufacturing } & \$ 5 \\ \hline \text { Selling and administrative } & \$ 8 \\ \hline \text { Fixed costs in total } & \\ \hline \text { Manufacturing } & \$ 60,000\\ \hline \text { Selling and administrative } & \$ 82,500 \\\hline \end{array}$ There were no units in inventory at the beginning of the year. During the year, 30,000 units were produced and 25,000 units were sold. Each unit sells for $\$ 35$. -What was the company's operating income under variable costing?

A) $407,500. B) $417,500. C) $421,250. D) $431,250. A) $407,500. B) $417,500. C) $421,250. D) $431,250.

During the past year, Carr Company manufactured 25,000 units and sold 20,000 units. Production costs for the year were as follows: $\begin{array} { | l | r | } \hline \text { Direct materials } & \$ 180,000 \\ \hline \text { Direct labour } & 120,000 \\ \hline \text { Variable manufacturing overhead } & 210,000 \\ \hline \text { Fixed manufacturing overhead } & 250,000 \\ \hline \end{array}$Total sales were $850,000, total variable selling expenses were $110,000, and total fixed selling and administrative expenses were $170,000. There were no units in beginning inventory. Assume that direct labour is a variable cost. Do not round intermediate calculations. -What was the contribution margin per unit?

A) $12.10. B) $16.60. C) $17.70. D) $22.10. A) $12.10. B) $16.60. C) $17.70. D) $22.10.

New Look Company, which has only one product, has provided the following data concerning its most recent month of operations: $\begin{array}{|l|r|} \hline \text { Selling price } & \$ 95 \\ \hline \text { Units in beginning inventory } & 0 \\ \hline \text { Units produced } & 3,800 \\ \hline \text { Units sold } & 3,600 \\ \hline \text { Units in ending inventory } & 200 \\ \hline \text { Variable costs per unit: } & \\\hline \text { Direct materials } & \$ 22 \\ \hline \text { Direct labour } & \$ 11 \\ \hline \text { Variable manufacturing overhead } & \$ 2 \\ \hline \text { Variable selling and administrative } & \$ 9 \\\hline \text { Fixed costs: } & \\ \hline \text { Fixed manufacturing overhead } & \$ 102,600 \\ \hline \text { Fixed selling and administrative } & \$ 63,200 \\ \hline \end{array}$ -What was the total contribution margin for the month under the variable costing approach?

A) $62,800. B) $95,200. C) $156,400. D) $183,600. A) $62,800. B) $95,200. C) $156,400. D) $183,600.

O'Briens Company, which has only one product, has provided the following data concerning its most recent month of operations: $\begin{array} { | l | r | } \hline \text { Selling price } & \$ 165 \\ \hline \text { Units in beginning inventory } & 0 \\ \hline \text { Units produced } & 4,300 \\ \hline \text { Units sold } & 3,800 \\ \hline \text { Units in ending inventory } & 500 \\ \hline \text { Variable costs per unit: } & \\ \hline \text { Direct materials } & \$ 31 \\ \hline \text { Direct labour } & \$ 43 \\ \hline \text { Variable manufacturing overhead } & \$ 5 \\ \hline \text { Variable selling and administrative } & \$ 8 \\ \hline \text { Fixed costs: } & \\ \hline \text { Fixed manufacturing overhead } &\$ 165,400 \\ \hline \text { Fixed selling and administrative } & \$ 80,200 \\ \hline \end{array}$ -What was the unit product cost for the month under variable costing?

A) $79. B) $87. C) $115. D) $124. A) $79. B) $87. C) $115. D) $124.

The following data pertain to one month's operations of Whitney, Inc.: $\begin{array} { | l | r | } \hline \text { Units in beginning inventory } & 0 \\ \hline \text { Units produced } & 9,000 \\ \hline \text { Units sold } &8,000 \\ \hline \text { Variable costs per unit: } & \\ \hline \text { Manufacturing } & \$ 10 \\ \hline \text { Selling and administrative } & \$ 6 \\ \hline \text { Fixed costs in total } & \\ \hline \text { Manufacturing } & \$ 18,000 \\ \hline \text { Selling and administrative } & \$ 27,000 \\ \hline \end{array}$ -What was the carrying value on the balance sheet of the ending finished goods inventory under variable costing?

A) $10,000. B) $12,000. C) $16,000. D) $19,000. A) $10,000. B) $12,000. C) $16,000. D) $19,000.

Jarvix Company, which has only one product, has provided the following data concerning its most recent month of operations: $\begin{array}{l|r|} \hline \text { Selling price } & \$ 111 \\ \hline \text { Units in beginning inventory } & 0 \\ \hline \text { Units produced } & 8,800 \\ \hline \text { Units sold } & 8,900 \\ \hline \text { Variable costs per unit: } & \\ \hline \text { Direct materials } & \$ 34 \\\hline \text { Direct labour } & \$ 37 \\ \hline \text { Variable manufacturing overhead } & \$ 3 \\ \hline \text { Variable selling and administrative } & \$ 9 \\ \hline \text { Fixed costs: } &\\ \hline \text { Fixed manufacturing overhead } & \$ 61,600 \\ \hline \text { Fixed selling and administrative } & \$ 169,100 \\ \hline \end{array}$The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. -What was the operating income for the month under variable costing?

A) $2,100. B) $17,800. C) $18,500. D) $25,900. A) $2,100. B) $17,800. C) $18,500. D) $25,900.

Aaker Company, which has only one product, has provided the following data concerning its most recent month of operations: $\begin{array} { | l | r | } \hline \text { Selling price } & \$ 99 \\ \hline \text { Units in beginning inventory } & 0 \\ \hline \text { Units produced } & 6,300 \\ \hline \text { Units sold } & 6,000 \\ \hline \text { Units in ending inventory } & 300 \\ \hline \text { Variable costs per unit: } & \\ \hline \text { Direct materials } & \$ 12 \\ \hline \text { Direct labour } & \$ 42 \\ \hline \text { Variable manufacturing overhead } & \$ 6 \\ \hline \text { Variable selling and administrative } & \$ 6 \\ \hline \text { Fixed costs: } & \\ \hline \text { Fixed manufacturing overhead } & \$ 170,100 \\ \hline \text { Fixed selling and administrative } & \$ 24,000 \\ \hline \end{array}$ -What is the operating income (loss)for the month under variable costing?

A) ($14,100). B) $3,900. C) $8,100. D) $12,000. A) ($14,100). B) $3,900. C) $8,100. D) $12,000.

Exam 8: Variable Costing: A Tool for Management

Farron Company, which has only one product, has provided the following data concerning its most recent month of operations: Selling price \ 92 Units in beginning inventory 0 Units produced 8,700 Units sold 8,300 Units in ending inventory 400 Variable costs per unit: Direct materials \ 13 Direct labour \ 55 Variable manufacturing overhead \ 1 Variable selling and administrative \ 5 Fixed costs: Fixed manufacturing overhead \ 130,500 Fixed selling and administrative \ 8,300 -What was the unit product cost for the month under variable costing?

(Multiple Choice)

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Question 121

Jarvix Company, which has only one product, has provided the following data concerning its most recent month of operations: Selling price \ 111 Units in beginning inventory 0 Units produced 8,800 Units sold 8,900 Variable costs per unit: Direct materials \ 34 Direct labour \ 37 Variable manufacturing overhead \ 3 Variable selling and administrative \ 9 Fixed costs: Fixed manufacturing overhead \ 61,600 Fixed selling and administrative \ 169,100 The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. -What was the amount of fixed overhead released for the month under absorption costing?

(Multiple Choice)

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Question 122

Iancu Company, 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 labour \ 46 Variable manufacturing overhead \ 5 Variable selling and administrative \ 9 Fixed costs: Fixed manufacturing overhead \ 155,400 Fixed selling and administrative \ 70,200 -What was the operating income (loss)for the month under variable costing?

(Multiple Choice)

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Question 123

Farron Company, which has only one product, has provided the following data concerning its most recent month of operations: Selling price \ 92 Units in beginning inventory 0 Units produced 8,700 Units sold 8,300 Units in ending inventory 400 Variable costs per unit: Direct materials \ 13 Direct labour \ 55 Variable manufacturing overhead \ 1 Variable selling and administrative \ 5 Fixed costs: Fixed manufacturing overhead \ 130,500 Fixed selling and administrative \ 8,300 -What was the operating income (loss)for the month under absorption costing?

(Multiple Choice)

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Question 124

During the past year, Carr Company manufactured 25,000 units and sold 20,000 units. Production costs for the year were as follows: Direct materials \ 180,000 Direct labour 120,000 Variable manufacturing overhead 210,000 Fixed manufacturing overhead 250,000 Total sales were $850,000, total variable selling expenses were $110,000, and total fixed selling and administrative expenses were $170,000. There were no units in beginning inventory. Assume that direct labour is a variable cost. Do not round intermediate calculations. -Under absorption costing,what was the value of the ending inventory for the year?

(Multiple Choice)

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Question 125

Last year, Walsh Company manufactured 25,000 units and sold 22,000 units. Production costs were as follows: Direct materials \ 100,000 Direct labour 75,000 Variable manufacturing overhead 50,000 Fixed manufacturing overhead 75,000 Total sales were $440,000, total variable selling and administrative expenses were $110,000, and total fixed selling and administrative expenses were $45,000. There was no beginning inventory. Assume that direct labour is a variable cost. -What was the contribution margin per unit?

(Multiple Choice)

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Question 126

Last year, Harris Company manufactured 17,000 units and sold 13,000 units. Production costs for the year were as follows: Direct materials \ 153,000 Direct labour 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 labour is a variable cost. -What was the contribution margin per unit? Do not round intermediate calculations.

(Multiple Choice)

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Question 127

Khanam Company, which has only one product, has provided the following data concerning its most recent month of operations: Selling price \ 97 Units in beginning inventory 500 Units produced 8,400 Units in ending inventory 400 Variable costs per unit: Direct materials \ 20 Direct labour \ 37 Variable manufacturing overhead \ 1 Variable selling and administrative \ 11 Fixed costs: Fixed manufacturing overhead \ 67,200 Fixed selling and administrative \ 161,500 The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. -What is the operating income for the month under absorption costing?

(Multiple Choice)

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Question 128

O'Leary Company manufactures a single product that it sells for $\$ 29$ per unit. The company has the following cost structure: Variable costs per unit: Manufacturing \ 11 Selling and administrative \ 4 Fixed costs in total Manufacturing \ 80,000 Selling and administrative \ 58,000 There were no units in beginning inventory. During the year, 16,000 units were produced and 14,000 units were sold. -What was the company's operating income for the year under variable costing?

(Multiple Choice)

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Question 129

Khanam Company, which has only one product, has provided the following data concerning its most recent month of operations: Selling price \ 97 Units in beginning inventory 500 Units produced 8,400 Units in ending inventory 400 Variable costs per unit: Direct materials \ 20 Direct labour \ 37 Variable manufacturing overhead \ 1 Variable selling and administrative \ 11 Fixed costs: Fixed manufacturing overhead \ 67,200 Fixed selling and administrative \ 161,500 The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. -What was the operating income for the month under variable costing?

(Multiple Choice)

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Question 130

Erie Company manufactures a single product. Assume the following data for the year just completed: Variable costs per unit: Manufacturing \ 5 Selling and administrative \ 8 Fixed costs in total Manufacturing \ 60,000 Selling and administrative \ 82,500 There were no units in inventory at the beginning of the year. During the year, 30,000 units were produced and 25,000 units were sold. Each unit sells for $\$ 35$ . -What was the company's operating income under variable costing?

(Multiple Choice)

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Question 131

During the past year, Carr Company manufactured 25,000 units and sold 20,000 units. Production costs for the year were as follows: Direct materials \ 180,000 Direct labour 120,000 Variable manufacturing overhead 210,000 Fixed manufacturing overhead 250,000 Total sales were $850,000, total variable selling expenses were $110,000, and total fixed selling and administrative expenses were $170,000. There were no units in beginning inventory. Assume that direct labour is a variable cost. Do not round intermediate calculations. -What was the contribution margin per unit?

(Multiple Choice)

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Question 132

Absorption costing operating income is closer to the operating cash flow of a period than is variable costing operating income.

(True/False)

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Question 133

New Look Company, which has only one product, has provided the following data concerning its most recent month of operations: Selling price \ 95 Units in beginning inventory 0 Units produced 3,800 Units sold 3,600 Units in ending inventory 200 Variable costs per unit: Direct materials \ 22 Direct labour \ 11 Variable manufacturing overhead \ 2 Variable selling and administrative \ 9 Fixed costs: Fixed manufacturing overhead \ 102,600 Fixed selling and administrative \ 63,200 -What was the total contribution margin for the month under the variable costing approach?

(Multiple Choice)

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Question 134

Last year,fixed manufacturing overhead costs were $30,000,variable production costs were $48,000,fixed selling and administration costs were $20,000,and variable selling administrative expenses were $9,600.There was no beginning inventory.During the year,3,000 units were produced and 2,400 units were sold at a price of $40 per unit.Under variable costing,what would be the operating income (loss)?

(Multiple Choice)

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Question 135

O'Briens Company, which has only one product, has provided the following data concerning its most recent month of operations: Selling price \ 165 Units in beginning inventory 0 Units produced 4,300 Units sold 3,800 Units in ending inventory 500 Variable costs per unit: Direct materials \ 31 Direct labour \ 43 Variable manufacturing overhead \ 5 Variable selling and administrative \ 8 Fixed costs: Fixed manufacturing overhead \ 165,400 Fixed selling and administrative \ 80,200 -What was the unit product cost for the month under variable costing?

(Multiple Choice)

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Question 136

The following data pertain to one month's operations of Whitney, Inc.: Units in beginning inventory 0 Units produced 9,000 Units sold 8,000 Variable costs per unit: Manufacturing \ 10 Selling and administrative \ 6 Fixed costs in total Manufacturing \ 18,000 Selling and administrative \ 27,000 -What was the carrying value on the balance sheet of the ending finished goods inventory under variable costing?

(Multiple Choice)

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Question 137

Jarvix Company, which has only one product, has provided the following data concerning its most recent month of operations: Selling price \ 111 Units in beginning inventory 0 Units produced 8,800 Units sold 8,900 Variable costs per unit: Direct materials \ 34 Direct labour \ 37 Variable manufacturing overhead \ 3 Variable selling and administrative \ 9 Fixed costs: Fixed manufacturing overhead \ 61,600 Fixed selling and administrative \ 169,100 The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. -What was the operating income for the month under variable costing?

(Multiple Choice)

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Question 138

Nelson Company,which has only one product,has provided the following data concerning its most recent month of operations: Selling price \ 84 Units in beginning inventory 500 Units produced 1,900 Units sold 2,100 Units in ending inventory 300 Variable costs per unit: Direct materials \ 25 Direct labour \ 10 Variable manufacturing overhead \ 7 Variable selling and administrative \ 10 Fixed costs: Fixed manufacturing overhead \ 38,000 Fixed selling and administrative \ 21,000 The company produces the same number of units every month,although the sales in units vary from month to month.The company's variable costs per unit and total fixed costs have been constant from month to month. Required: a)Prepare an income statement for the month using the contribution format and the variable costing method. b)Prepare an income statement for the month using the absorption costing method.

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Question 139

Aaker Company, which has only one product, has provided the following data concerning its most recent month of operations: Selling price \ 99 Units in beginning inventory 0 Units produced 6,300 Units sold 6,000 Units in ending inventory 300 Variable costs per unit: Direct materials \ 12 Direct labour \ 42 Variable manufacturing overhead \ 6 Variable selling and administrative \ 6 Fixed costs: Fixed manufacturing overhead \ 170,100 Fixed selling and administrative \ 24,000 -What is the operating income (loss)for the month under variable costing?

(Multiple Choice)

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Question 140

Absorption costing operating income is closer to the operating cash flow of a period than is variable costing operating income.

Managerial Accounting and the Business Environment

Cost Terms,concepts,and Classifications

Cost Behaviour: Analysis and Use

Cost-Volume-Profit Relationships

Systems Design: Job-Order Costing

Systems Design: Process Costing

Activity-Based Costing: A Tool to Aid Decision Making

Budgeting

Standard Costs and Overhead Analysis

Reporting for Control

Relevant Costs for Decision Making

Capital Budgeting Decisions

Financial Statement Analysis

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