Question

In: Accounting

Please show work 6. Stone Company has no beginning and ending inventories, and reports the following...

Please show work

6. Stone Company has no beginning and ending inventories, and reports the following data about its only product:

Direct materials used $375,000
Direct labor $125,000
Fixed indirect manufacturing $100,000
Fixed selling and administrative $150,000
Variable indirect manufacturing $50,000
Variable selling and administrative $110,000
Selling price(per unit) $100

Units produced and sold 17,500

Stone Company uses the absorption approach to prepare the income statement. What is the manufacturing cost of goods sold?
A) $375,000
B) $500,000
C) $650,000
D) $700,000   

5. Blue Company has no beginning and ending inventories, and reports the following information for its only product:

Direct materials used $450,000
Direct labor $125,000
Fixed indirect manufacturing $80,000
Variable indirect manufacturing $70,000
Variable selling and administrative $60,000
Fixed selling and administrative $25,000

Units produced and sold 75,000

Blue Company uses the absorption approach to prepare the income statement. What is the product cost per unit?
A) $9.00    
B) $11.25
C) $12.00
D) $12.75

Solutions

Expert Solution

Question 6

Correct answer—(C) $650,000

Calculation of Cost of goods sold

Direct material

$ 375,000.00

Direct labor

$ 125,000.00

Fixed indirect manufacturing cost

$ 100,000.00

Variable indirect manufacturing cost

$   50,000.00

Total manufacturing cost/Cost of goods sold

$ 650,000.00

Selling cost either variable or fixed are operating expenses and not included in cost of manufacturing.

Question 5

Correct answer---$9.67

It seems like all the options given in question are incorrect.

Leave a comment in case of any confusion.

Cost per Unit

Direct material

$ 450,000.00

Direct labor

$ 125,000.00

Fixed indirect manufacturing cost

$    80,000.00

Variable indirect manufacturing cost

$    70,000.00

Total manufacturing cost/Cost of goods sold

$ 725,000.00

Units produced

75000

Cost per Unit

$               9.67

ekkarill92 answered 1 year ago
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