Question
In: Accounting
Nascar Motors assembles and sells motor vehicles and uses standard costing. Actual data relating to April...
Nascar Motors assembles and sells motor vehicles and uses standard costing. Actual data relating to April and May 2017 are as follows:
|
April |
May |
|
|
Unit data: |
||
|
Beginning inventory |
0 |
50 |
|
Production |
600 |
525 |
|
Sales |
550 |
545 |
|
Variable costs: |
||
|
Manufacturing cost per unit produced |
$9,000 |
$9,000 |
|
Operating (marketing) cost per unit sold |
4,000 |
4,000 |
|
Fixed costs: |
||
|
Manufacturing costs |
$2,250,000 |
$2,250,000 |
|
Operating (marketing) costs |
725,000 |
725,000 |
The selling price per vehicle is $29,000. The budgeted level of production used to calculate the budgeted fixed manufacturing cost per unit is 600 units. There are no price, efficiency, or spending variances. Any production-volume variance is written off to the cost of goods sold in the month in which it occurs.
| Prepare April and May 2017 income statements for Nascar Motors under (a) variable costing and (b) absorption costing. |
|
|
2. |
Prepare a numerical reconciliation and explanation of the difference between operating income for each month under variable costing and absorption costing. |
Solutions
ekkarill92 answered 2 years agoRelated Solutions
operating-income differences. Nascar Motors assembles and sells motor vehicles and uses standard costing. Actual data relating...
operating-income differences. Nascar Motors assembles and
sells motor vehicles and uses standard costing. Actual data
relating to April and May 2017 are as follows:
The selling price per vehicle is $24,000. The budgeted level
of production used to calculate the budgeted fixed manufacturing
cost per unit is 500 units. There are no price, efficiency, or
spending variances. Any production-volume variance is written off
to cost of goods sold in the month in which it occurs.
Required:
Prepare April and May...
Champion Motors assembles and sells motor vehicles and uses standard costing. Actual data and variable costing...
Champion Motors assembles and sells motor vehicles and uses
standard costing. Actual data and variable costing and absorption
costing income statements relating to April and May 2017are as
follows:
April
May
Unit data:
Beginning inventory
0
150
Production
700
675
Sales
550
800
Variable costs:
Manufacturing cost per unit produced
$8,000
$8,000
Operating (marketing) cost per unit sold
3,200
3,200
Fixed costs:
Manufacturing costs
$2,100,000
$2,100,000
Operating (marketing) costs
700,000
700,000
The selling price per vehicle is $21,000. The budgeted...
9-21 Variable and absorption costing, explaining operating-income differences. Nascar Motors assembles and sells motor vehicles and...
9-21 Variable and absorption costing, explaining
operating-income differences. Nascar Motors assembles and sells
motor vehicles and uses standard costing. Actual data relating to
April and May 2017 are as follows:
April May
Unit Data:
Beginning Inventory 0 150
Production 500 400
sales 350 520
Variable Costs
Manufacturing cost per unit produced $10,000
$10,000
Operating cost per unit sold 3000 3000
Fixed Costs
Manufacturing Costs $2,000,000
$2,000,000
Operating Costs 600,000 ...
Income Statements under Absorption Costing and Variable Costing Gallatin County Motors Inc. assembles and sells snowmobile...
Income Statements under Absorption Costing and Variable
Costing
Gallatin County Motors Inc. assembles and sells snowmobile
engines. The company began operations on July 1 and operated at
100% of capacity during the first month. The following data
summarize the results for July:
Sales (11,500 units)
$1,610,000
Production costs (15,000 units):
Direct materials
$777,000
Direct labor
373,500
Variable factory overhead
186,000
Fixed factory overhead
124,500
1,461,000
Selling and administrative expenses:
Variable selling and administrative expenses
$226,500
Fixed selling and administrative expenses...
Income Statements under Absorption Costing and Variable Costing Gallatin County Motors Inc. assembles and sells snowmobile...
Income Statements under Absorption Costing and Variable
Costing
Gallatin County Motors Inc. assembles and sells snowmobile
engines. The company began operations on July 1 and operated at
100% of capacity during the first month. The following data
summarize the results for July:
Sales (16,500 units)
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Production costs (21,000 units):
Direct materials
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Direct labor
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Variable factory overhead
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Fixed factory overhead
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Selling and administrative expenses:
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Fixed selling and administrative expenses...
Income Statements under Absorption Costing and Variable Costing Gallatin County Motors Inc. assembles and sells snowmobile...
Income Statements under Absorption Costing and Variable Costing
Gallatin County Motors Inc. assembles and sells snowmobile engines.
The company began operations on July 1 and operated at 100% of
capacity during the first month. The following data summarize the
results for July: Sales (13,000 units) $2,080,000 Production costs
(17,000 units): Direct materials $1,006,400 Direct labor 482,800
Variable factory overhead 241,400 Fixed factory overhead 161,500
1,892,100 Selling and administrative expenses: Variable selling and
administrative expenses $293,300 Fixed selling and administrative
expenses...
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Income Statements under Absorption Costing and Variable
Costing
Gallatin County Motors Inc. assembles and sells snowmobile
engines. The company began operations on July 1 and operated at
100% of capacity during the first month. The following data
summarize the results for July:
Sales (13,500 units)
$1,215,000
Production costs (17,000 units):
Direct materials
$566,100
Direct labor
272,000
Variable factory overhead
136,000
Fixed factory overhead
90,100
1,064,200
Selling and administrative expenses:
Variable selling and administrative expenses
$165,000
Fixed selling and administrative expenses...
Income Statements under Absorption Costing and Variable Costing Gallatin County Motors Inc. assembles and sells snowmobile...
Income Statements under Absorption Costing and Variable
Costing
Gallatin County Motors Inc. assembles and sells snowmobile
engines. The company began operations on July 1 and operated at
100% of capacity during the first month. The following data
summarize the results for July:
Sales (11,500 units)
$1,150,000
Production costs (15,000 units):
Direct materials
$555,000
Direct labor
267,000
Variable factory overhead
133,500
Fixed factory overhead
88,500
1,044,000
Selling and administrative expenses:
Variable selling and administrative expenses
$161,800
Fixed selling and administrative expenses...
Super Speed Motor Co. assembles motors of sport cars. It jobs costing system has two direct...
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costing system has two direct cost categories (direct materials and
direct labors) and one indirect cost pool ( manufacturing overhead
allocated at a budgeted rate per machine hour.) The budgeted
manufacturing overhead was $800,000 and the budgeted machine hours
200,000. The following data ( in thousands ) pertain to January
2020:
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………………………………… 22
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c) Indirect...
Super Speed Motor Co. assembles motors of sport cars. It jobs costing system has two direct...
Super Speed Motor Co. assembles motors
of sport cars. It jobs costing system has two direct cost
categories (direct materials and direct labors) and one indirect
cost pool (manufacturing overhead allocated at a budgeted rate per
machine hour.) The budgeted manufacturing overhead was
$800,000 and the budgeted machine hours 200,000. The following data
(in thousands) pertain to January 2020:
Direct materials and supplies purchased on account
………………………………… 22
Direct materials used
………………………………………………………………… 19
Indirect materials issued to various...
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