In: Accounting
Use the following information to calculate cash paid for income
taxes:
Income Tax Expense | $ | 65,000 | |
Income Tax Payable, January 1 | 24,000 | ||
Income Tax Payable, December 31 | 14,500 | ||
Multiple Choice
$65,000.
$89,000.
$79,500.
$55,500.
$74,500.
A manufacturer reports the following costs to produce 24,000 units in its first year of operations: Direct materials, $24 per unit, Direct labor, $20 per unit, Variable overhead, $216,000, and Fixed overhead, $288,000. Of the 24,000 units produced, 23,200 were sold, and 800 remain in inventory at year-end. Under absorption costing, the value of the inventory is:
Multiple Choice
$35,200.
$42,400.
$52,000.
$44,800.
$26,400.
Correct Answer = Option #5: $ 74,500 is the cash paid for Income Taxes
Working |
|
Income tax payables Jan 1 |
$ 24,000 |
Add: Income tax expense |
$ 65,000 |
Income tax payables 31 Dec |
$ (14,500) |
Income tax paid in cash |
$ 74,500 = Answer |
Correct Answer = Option #3: $ 52,000
A |
Direct material |
$ 24 |
B |
Direct Labor |
$ 20 |
C = 216000 / 24000 units |
Variable Overhead |
$ 9 |
D = 288000 / 24000 units |
Fixed Overhead per unit |
$ 12 |
E = A+B+C+D |
Total manufacturing cost per unit |
$ 65 |
F |
Units in ending Inventory |
800 |
G = E/F |
Value of Inventory |
$ 52,000 = Answer |