Exam 5: Variable Costing and Segment Reporting: Tools for Management

Kilihea Corporation produces a single product. The company's absorption costing income statement for July follows: The company's variable production costs are $20 per unit and its fixed manufacturing overhead totals $80,000 per month. -The break-even point in units for the month under variable costing is:

The Rial Company's income statement for June is given below: -If the sales in Division L increase by 30% while common fixed expenses in the company decrease by $10,000,the segment margin for Division L should:

Fellner Corporation produces a single product and has the following cost structure: Required: a.Compute the unit product cost under absorption costing.Show your work! b.Compute the unit product cost under variable costing.Show your work!

Favini Company, which has only one product, has provided the following data concerning its most recent month of operations: -What is the unit product cost for the month under variable costing?

Eagle Corporation manufactures a picnic table. Shown below is Eagle's cost structure: In its first year of operations, Eagle produced and sold 10,000 tables. The tables sold for $120 each. -If Eagle had sold only 9,000 tables in its first year,what total amount of cost would have been assigned to the 1,000 tables in finished goods inventory under the absorption costing method?

Carr Company produces a single product. During the past year, Carr manufactured 25,000 units and sold 20,000 units. Production costs for the year were as follows: -The net operating income for the year under variable costing would be:

Last year,Heidenescher Corporation's variable costing net operating income was $63,600 and its inventory decreased by 600 units.Fixed manufacturing overhead cost was $1 per unit.What was the absorption costing net operating income last year?

The carrying value of finished goods inventory at the end of the year under variable costing would be:

Maga Company,which has only one product,has provided the following data concerning its most recent month of operations: 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 a contribution format income statement for the month using variable costing. d.Prepare an income statement for the month using absorption costing. e.Reconcile the variable costing and absorption costing net operating incomes for the month.

Canon Company has two sales areas: North and South. During last year, the contribution margin in the North Area was $50,000, or 20% of sales. The segment margin in the South was $15,000, or 8% of sales. Traceable fixed expenses are $15,000 in the North and $10,000 in the South. During last year, the company reported total net operating income of $26,000. -The total fixed expenses (traceable and common)for Canon Company for the year were:

Byron Company, which has only one product, has provided the following data concerning its most recent month of operations: -What is the unit product cost for the month under variable costing?

Variable manufacturing overhead costs are treated as period costs under both absorption and variable costing.

Hudalla Corporation produces a single product and has the following cost structure: Required: Compute the unit product cost under variable costing.Show your work!

Which of the following are considered to be product costs under absorption costing? I.Variable manufacturing overhead. II)Fixed manufacturing overhead. III)Selling and administrative expenses.

The Rial Company's income statement for June is given below: -A proposal has been made that will lower variable expenses in Division L to 35% of sales.However,this reduction can only be accomplished by a $15,000 increase in Division L's traceable fixed expenses.If this proposal is implemented and if sales remain constant,overall company net operating income should:

The IT Corporation produces and markets two types of electronic calculators: Model 11 and Model 12.The following data were gathered on activities last month: Required: Prepare a segmented income statement in the contribution format for last month.

Tennison Corporation has two major business segments-Consumer and Commercial. Data for the segment and for the company for May appear below: In addition, common fixed expenses totaled $371,000 and were allocated as follows: $186,000 to the Consumer business segment and $185,000 to the Commercial business segment. -A properly constructed segmented income statement in a contribution format would show that the net operating income of the company as a whole is:

Ring, Incorporated's income statement for the most recent month is given below. For each of the following questions, refer back to the original data. -If sales in Store Q increase by $30,000 as a result of a $7,000 increase in traceable fixed costs:

Tennison Corporation has two major business segments-Consumer and Commercial. Data for the segment and for the company for May appear below: In addition, common fixed expenses totaled $371,000 and were allocated as follows: $186,000 to the Consumer business segment and $185,000 to the Commercial business segment. -A properly constructed segmented income statement in a contribution format would show that the segment margin of the Consumer business segment is:

Pong Incorporated's income statement for the most recent month is given below. -If Store G sales increase by $40,000 with no change in fixed costs,the overall company net operating income should: