Question

In: Accounting

A business operated at 100% of capacity during its first month and incurred the following costs:...

A business operated at 100% of capacity during its first month and incurred the following costs:

Production costs (5,000 units):
Direct materials-$70,000

Direct labor-20,000

Variable factory overhead-10,000

Fixed factory overhead-20,000

total $102,000

Operating expenses:
Variable operating expenses-$17,000

Fixed operating expenses-1,000


total $18000

Prepare a variable income statement assuming 1000 units remain unsold at the end of the month and sales total $160,000 for the month

Solutions

Expert Solution

Calculate income from operation
Amount($)
Sales       1,60,000
Less: Variable cost of production
Direct material                56,000
Direct labour                16,000
Variable factory overhead                  8,000         -80,000
Manufacturing margin          80,000
Variable operating expense         -17,000
Contribution margin          63,000
Less; Fixed expense
Fixed factory overhead                2,000
Fixed operating expense                1,000           -3,000
Income from operation          60,000
Direct material =(70,000/5,000*4,000)=56,000
Direct labour =(20,000/5,000*4,000)= 16,000
Variable factory overhead= (10,000/5,000*4,000)=8,000
Note : Fixed factory overhead wrongly enter in problem $20,000 instant of 2000
Calculation Fixed factory overhead=102,000-70,000-20,000-10,000=$2,000

Related Solutions

A business operated at 100% of capacity during its first month and incurred the following costs:...
A business operated at 100% of capacity during its first month and incurred the following costs: Production costs (18,600 units): Direct materials $172,100 Direct labor 234,800 Variable factory overhead 267,600 Fixed factory overhead 100,300 $774,800 Operating expenses: Variable operating expenses $131,500 Fixed operating expenses 46,900 178,400 If 1,800 units remain unsold at the end of the month, what is the amount of inventory that would be reported on the variable costing balance sheet? The actual price for a product was...
A business operated at 100% of capacity during its first month and incurred the following costs:...
A business operated at 100% of capacity during its first month and incurred the following costs: Production costs (18,100 units): Direct materials $171,800 Direct labor 220,400 Variable factory overhead 256,100 Fixed factory overhead 102,000 $750,300 Operating expenses: Variable operating expenses $128,600 Fixed operating expenses 43,000 171,600 If 1,600 units remain unsold at the end of the month and sales total $1,143,000 for the month, what would be the amount of income from operations reported on the variable costing income statement?...
A business operated at 100% of capacity during its first month and incurred the following costs:...
A business operated at 100% of capacity during its first month and incurred the following costs: Production costs (10,000 units):   Direct materials $170,000   Direct labor 360,000   Variable factory overhead 190,000   Fixed factory overhead     50,000 $770,000 Operating expenses:   Variable operating expenses $ 60,000   Fixed operating expenses     18,000 78,000 If 500 units remain unsold at the end of the month, what is the amount of inventory that would be reported on the variable costing balance sheet? a.$41,500 b.$42,800 c.$38,500 d.$36,000
1. A business operated at 100% of capacity during its first month and incurred the following...
1. A business operated at 100% of capacity during its first month and incurred the following costs: Production costs (17,100 units):     Direct materials $171,800     Direct labor 237,200     Variable factory overhead 264,600     Fixed factory overhead 97,600 $771,200 Operating expenses:     Variable operating expenses $127,300     Fixed operating expenses 40,600 167,900 If 1,800 units remain unsold at the end of the month, what is the amount of inventory that would be reported on the variable costing balance sheet? a.$84,305 b.$81,179 c.$98,853 d.$70,902 2. A...
13. A. A business operated at 100% of capacity during its first month and incurred the...
13. A. A business operated at 100% of capacity during its first month and incurred the following costs: Production costs (20,700 units):     Direct materials $172,500     Direct labor 232,400     Variable factory overhead 259,600     Fixed factory overhead 97,500 $762,000 Operating expenses:     Variable operating expenses $134,200     Fixed operating expenses 46,900 181,100 If 1,600 units remain unsold at the end of the month, what is the amount of inventory that would be reported on the variable costing balance sheet? a. $51,360 b. $61,735 c....
41. 1 . a business operated at 100% of capacity during its first month and incurred...
41. 1 . a business operated at 100% of capacity during its first month and incurred the following costs: Production costs (20,200 units): Direct materials $177,700 Direct labor 221,800 Variable factory overhead 268,100 Fixed factory overhead 92,500 $760,100 Operating expenses: Variable operating expenses $132,800 Fixed operating expenses 40,800 173,600 If 1,900 units remain unsold at the end of the month and sales total $1,081,000 for the month, what would be the amount of income from operations reported on the absorption...
1. A business operated at 100% of capacity during its first month, with the following results:...
1. A business operated at 100% of capacity during its first month, with the following results: Sales (114 units) $638,400 Production costs (142 units):    Direct materials $85,961    Direct labor 21,948    Variable factory overhead 38,408    Fixed factory overhead 36,579 182,896 Operating expenses:    Variable operating expenses $5,576    Fixed operating expenses 4,166 9,742 The amount of operating income that would be reported on the absorption costing income statement is a. $638,258 b. $511,192 c. $515,358 d. $481,826 2. Myers Corporation has the following...
A business operated at 100% of capacity during its first month, with the following results: Sales...
A business operated at 100% of capacity during its first month, with the following results: Sales (112 units) $560,000 Production costs (140 units):    Direct materials $70,000    Direct labor 17,500    Variable factory overhead 31,500    Fixed factory overhead 28,000 147,000 Operating expenses:    Variable operating expenses $5,860    Fixed operating expenses 3,680 9,540 The amount of operating income that would be reported on the variable costing income statement is a.$559,860 b.$427,260 c.$458,940 d.$550,460
A business operated at 100% of capacity during its first month, with the following results: Sales...
A business operated at 100% of capacity during its first month, with the following results: Sales (106 units) $498,200 Production costs (132 units):    Direct materials $67,065    Direct labor 17,123    Variable factory overhead 29,965    Fixed factory overhead 28,539 142,692 Operating expenses:    Variable operating expenses $6,403    Fixed operating expenses 4,854 11,257 The amount of operating income that would be reported on the absorption costing income statement is a.$395,275 b.$400,129 c.$372,357 d.$498,068
During the month of January, the following costs were incurred:
  During the month of January, the following costs were incurred: 2010 Jan 8     Purchased Materials for cash, $150,000 Jan 10    Requisition for Direct Materials that were put into production, $100,000 Jan 20    Requisitioned for Indirect Materials that were put into production, $4,000. Jan 23    Direct Labor cost incurred during the period, $60,000 when the labor rate per hour was $5. Jan 25    Indirect labor cost incurred during the month of January is $6,000. Jan 28    Paid factory supervisor’s salaries...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT