Question

In: Accounting

The Dean Corporation produces and sells a single product. The following data refer to the year...

The Dean Corporation produces and sells a single product. The following data refer to the year just completed:

    

  Beginning inventory 0
  Units produced 29,700
  Units sold 22,700
  Selling price per unit $ 469
  Selling and administrative expenses:
  Variable per unit $ 20
  Fixed (total) $ 522,100
  Manufacturing costs:
  Direct materials cost per unit $ 206
  Direct labor cost per unit $ 53
  Variable manufacturing overhead cost per unit $ 37
  Fixed manufacturing overhead (total) $ 415,800

   

Assume that direct labor is a variable cost.
Required:
a.

Compute the cost of a single unit of product under both the absorption costing and variable costing approaches.

       

b.

Prepare an income statement for the year using absorption costing.

       

c.

Prepare a contribution format income statement for the year using variable costing.

       

d.

Reconcile the absorption costing and variable costing net operating income figures in (b) and (c) above.

       

Solutions

Expert Solution

ekkarill92 answered 2 years ago
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