Question
In: Accounting
Lynch Company manufactures and sells a single product. The following costs were incurred during the company’s...
Lynch Company manufactures and sells a single product. The following costs were incurred during the company’s first year of operations:
| Variable costs per unit: | ||
| Manufacturing: | ||
| Direct materials | $ | 12 |
| Direct labor | $ | 9 |
| Variable manufacturing overhead | $ | 2 |
| Variable selling and administrative | $ | 2 |
| Fixed costs per year: | ||
| Fixed manufacturing overhead | $ | 403,000 |
| Fixed selling and administrative | $ | 313,000 |
During the year, the company produced 31,000 units and sold 26,000 units. The selling price of the company’s product is $55 per unit.
Required:
1. Assume that the company uses absorption costing:
a. Compute the unit product cost.
b. Prepare an income statement for the year.
Prepare an income statement for the year. Assume that the company uses absorption costing.
|
|||||||||||||||
2. Assume that the company uses variable costing:
a. Compute the unit product cost.
b. Prepare an income statement for the year
|
||||||||||||||||||||||||||||||||||||||||||||||
Solutions
Expert Solution
Answer of Part 1–a:
Unit Product Cost = Direct Material + Direct Labor + Variable
Manufacturing Overhead +Fixed Manufacturing Overhead
Unit Product Cost = $12 + $9 + $2 + ($403,000 / 31,000)
Unit Product Cost = $12 + $9 + $2 + $13
Unit Product Cost = $36
Answer of Part 2-a:
Unit Product Cost = Direct Material + Direct Labor + Variable
Manufacturing Overhead
Unit Product Cost = $12 + $9 + $2
Unit Product Cost = $23
ekkarill92 answered 2 years agoRelated Solutions
Lynch Company manufactures and sells a single product. The following costs were incurred during the company’s...
Lynch Company manufactures and sells a single product. The
following costs were incurred during the company’s first year of
operations:
Lynch Company manufactures and sells a single product. The
following costs were incurred during the company’s first year of
operations:
Variable costs per unit:
Manufacturing:
Direct materials
$
11
Direct labor
$
5
Variable manufacturing overhead
$
2
Variable selling and administrative
$
2
Fixed costs per year:
Fixed manufacturing overhead
$
350,000
Fixed selling and administrative
$
260,000
During...
Lynch Company manufactures and sells a single product. The following costs were incurred during the company’s...
Lynch Company manufactures and sells a single product. The
following costs were incurred during the company’s first year of
operations:
Variable costs per unit:
Manufacturing:
Direct materials
$
11
Direct labor
$
8
Variable manufacturing overhead
$
1
Variable selling and administrative
$
1
Fixed costs per year:
Fixed manufacturing overhead
$
420,000
Fixed selling and administrative
$
330,000
During the year, the company produced 30,000 units and sold
25,000 units. The selling price of the company’s product is $54...
Lynch Company manufactures and sells a single product. The following costs were incurred during the company’s...
Lynch Company manufactures and sells a single product. The
following costs were incurred during the company’s first year of
operations:
Variable costs
per unit:
Manufacturing:
Direct
materials
$
11
Direct
labor
$
5
Variable
manufacturing overhead
$
2
Variable selling
and administrative
$
2
Fixed costs per
year:
Fixed
manufacturing overhead
$
350,000
Fixed selling
and administrative
$
260,000
During the year, the company produced 35,000 units and sold
25,000 units. The selling price of the company’s product is $46...
Lynch Company manufactures and sells a single product. The following costs were incurred during the company’s...
Lynch Company
manufactures and sells a single product. The following costs were
incurred during the company’s first year of operations:
Variable costs
per unit:
Manufacturing:
Direct
materials
$
13
Direct
labor
$
5
Variable
manufacturing overhead
$
1
Variable selling
and administrative
$
1
Fixed costs per
year:
Fixed
manufacturing overhead
$
320,000
Fixed selling
and administrative expenses
$
230,000
During the year, the
company produced 32,000 units and sold 17,000 units. The selling
price of the company’s product is...
Lynch Company manufactures and sells a single product. The following costs were incurred during the company’s...
Lynch Company manufactures and sells a single product. The
following costs were incurred during the company’s first year of
operations: Variable costs per unit: Manufacturing: Direct
materials $ 11 Direct labor $ 8 Variable manufacturing overhead $ 1
Variable selling and administrative $ 1 Fixed costs per year: Fixed
manufacturing overhead $ 420,000 Fixed selling and administrative $
330,000 During the year, the company produced 30,000 units and sold
25,000 units. The selling price of the company’s product is $54...
Lynch Company manufactures and sells a single product. The following costs were incurred during the company’s...
Lynch Company manufactures and sells a single product. The
following costs were incurred during the company’s first year of
operations:
Variable costs per unit:
Manufacturing:
Direct materials
$
11
Direct labor
$
5
Variable manufacturing overhead
$
2
Variable selling and administrative
$
2
Fixed costs per year:
Fixed manufacturing overhead
$
264,000
Fixed selling and administrative
$
174,000
During the year, the company produced 22,000 units and sold
18,000 units. The selling price of the company’s product is $45...
Lynch Company manufactures and sells a single product. The following costs were incurred during the company’s...
Lynch Company
manufactures and sells a single product. The following costs were
incurred during the company’s first year of operations:
Variable costs
per unit:
Manufacturing:
Direct
materials
$
14
Direct
labor
$
5
Variable
manufacturing overhead
$
1
Variable selling
and administrative
$
1
Fixed costs per
year:
Fixed
manufacturing overhead
$
264,000
Fixed selling
and administrative
$
174,000
During the year, the
company produced 33,000 units and sold 15,000 units. The selling
price of the company’s product is $52...
Lynch Company manufactures and sells a single product. The following costs were incurred during the company’s...
Lynch Company manufactures and sells a single product. The
following costs were incurred during the company’s first year of
operations: Variable costs per unit: Manufacturing: Direct
materials $ 14 Direct labor $ 8 Variable manufacturing overhead $ 2
Variable selling and administrative $ 2 Fixed costs per year: Fixed
manufacturing overhead $ 250,000 Fixed selling and administrative
expenses $ 160,000 During the year, the company produced 25,000
units and sold 21,000 units. The selling price of the company’s
product is...
Lynch Company manufactures and sells a single product. The following costs were incurred during the company’s...
Lynch Company manufactures and sells a single product. The
following costs were incurred during the company’s first year of
operations:
Variable costs per unit:
Manufacturing:
Direct materials
$
10
Direct labor
$
4
Variable manufacturing overhead
$
1
Variable selling and administrative
$
1
Fixed costs per year:
Fixed manufacturing overhead
$
231,000
Fixed selling and administrative
$
141,000
During the year, the company produced 21,000 units and sold
17,000 units. The selling price of the company’s product is $40...
Lynch Company manufactures and sells a single product. The following costs were incurred during the company’s...
Lynch Company
manufactures and sells a single product. The following costs were
incurred during the company’s first year of operations:
Variable costs
per unit:
Manufacturing:
Direct
materials
$ 13
Direct
labor
$ 7
Variable
manufacturing overhead
$ 1
Variable selling
and administrative
$ 1
Fixed costs per
year:
Fixed
manufacturing overhead
$
288,000
Fixed selling
and administrative
$
198,000
During the year, the
company produced 24,000 units and sold 20,000 units. The selling
price of the company’s product is $48 per unit.
1. Assume...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Large lots are desirable in supply chain coordination despite increasing holding costs.
- ***Convert the C++ to Python*** #include <iostream> using std::cout; using std::cin; using std::endl; int charClass; char...
- Make-or-Buy Decision Fremont Computer Company has been purchasing carrying cases for its portable computers at a...
- The following costs were incurred for the single product produced during the first year of operations...
- Non-constant growth model: Do=$2.00 required return on equity= 5% g= 9% n=1,2 g=7% n=3,4 g=3% n=5...
- . Find all x ∈ Z143 such that x2Ξ 7 (mod 143). Please explain all steps...
- #Python: A palindrome is a sequence of characters that reads the same backwards as forwards. For...
ADVERTISEMENT