Question

Siren Company builds custom fishing lures for sporting goods stores. In its first year of operations, 2017, the company incurred the following costs.

Variable Costs per Unit
Direct materials		$7.95
Direct labor		$3.66
Variable manufacturing overhead		$6.15
Variable selling and administrative expenses		$4.13
Fixed Costs per Year
Fixed manufacturing overhead		$251,750
Fixed selling and administrative expenses		$222,706

Siren Company sells the fishing lures for $26.50. During 2017, the company sold 82,000 lures and produced 95,000 lures.

Assuming the company uses variable costing, calculate Siren’s manufacturing cost per unit for 2017. (Round answer to 2 decimal places, e.g.10.50.)

Manufacturing cost per unit

$

  

  

Prepare a variable costing income statement for 2017. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

SIREN COMPANY Income Statement                                                                       For the Year Ended December 31, 2017December 31, 2017For the Quarter Ended December 31, 2017 Variable Costing
Administrative ExpensesContribution MarginFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses				$
Administrative ExpensesContribution MarginFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses		$
Administrative ExpensesContribution MarginFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses
Administrative ExpensesContribution MarginFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses
Administrative ExpensesContribution MarginFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses
Administrative ExpensesContribution MarginFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses
Administrative ExpensesContribution MarginFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses				$

  

  

Assuming the company uses absorption costing, calculate Siren’s manufacturing cost per unit for 2017. (Round answer to 2 decimal places, e.g.10.50.)

Manufacturing cost per unit

$

  

  

Prepare an absorption costing income statement for 2017. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

SIREN COMPANY Income Statement                                                                       December 31, 2017For the Quarter Ended December 31, 2017For the Year Ended December 31, 2017 Absorption Costing
Administrative ExpensesContribution MarginCost of Goods SoldFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses				$
Administrative ExpensesContribution MarginCost of Goods SoldFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses
Administrative ExpensesContribution MarginCost of Goods SoldFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses
Administrative ExpensesContribution MarginCost of Goods SoldFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses		$
Administrative ExpensesContribution MarginCost of Goods SoldFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses
Administrative ExpensesContribution MarginCost of Goods SoldFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses				$

Answer 1