(a) Calculation of Polk\'s manufacturing cost per unit using variable costing Va
ID: 2480394 • Letter: #
Question
(a) Calculation of Polk's manufacturing cost per unit using variable costing Variable costing Direct Material $ 7.88 Direct Labor $ 2.57 Variable manufacturing overhead $ 6.04 Manufacturing cost per unit $ 16.49
(b) Variable costing Income statements: Sales (80,500 lures x $ 26.25 per lure) $ 21,13,125 Less: Variable cost of goods sold Beginning Inventory $ - Add Variable cost of goods manufactured (94,700 units x $ 16.49) $ 15,61,603 Cost of goods available for sale $ 15,61,603 Less ending inventory (14,200 lures x $16.49) $ 2,34,158 $ 13,27,445 Gross Contribution Margin $ 7,85,680 Less Variable selling and administrative expenses (80,500 lures x $ 4.10) $ 3,30,050 Contribution Margin $ 4,55,630 Less: Fixed costs: Fixed Manufacturing overhead $ 2,45,273 Fixed selling and administrative expenses $ 2,52,105 $ 4,97,378 Net Operating Loss $ -41,748
(c) Calculation of Polk's manufacturing cost per unit using absorption costing absorption costing Direct Material $ 7.88 Direct Labor $ 2.57 Variable manufacturing overhead $ 6.04 Fixed Manufacturing overhead $ 2.59 Manufacturing cost per unit $ 19.08 Manufacturing cost per unit $19.08-correct
(d) Prepare an absorption costing income statement for 2012. POLK COMPANY Income Statement For the Year Ended December 31, 2012 Absorption Costing
Explanation / Answer
POLK COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2012 ABSORPTION COSTING
DESCRIPTION AMOUNT $ AMOUNT $ SALES (80500 *$26.25) 2113125 LESS COST OF GOODS SOLD - BEGINNING INVENTORY N/A ADD COST OF GOODS MANUFACTURED (94700 * $19.08) 1806876 LESS- ENDINNING INVENTORY (14200 * $19.08) (270936) (1535940) GROSS PROFIT 577185 LESS- SELLING & ADMIN OVERHEAD VARIABLE SELLING & ADMIN COST 330050 FIXED MANUFACTURING COST 245273 FIXED SELLING & ADMIN COST 252105 827428 NET OPERATING PROFIT/ (LOSS) (250243)Related Questions
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