Question
In: Accounting
Lyons Company manufactures and sells one product. The following information pertains to the company’s first year...
Lyons Company manufactures and sells one product. The following information pertains to the company’s first year of operations:
| Variable cost per unit: | ||
| Direct materials | $ | 13 |
| Fixed costs per year: | ||
| Direct labor | $ | 750,000 |
| Fixed manufacturing overhead | $ | 420,000 |
| Fixed selling and administrative expenses | $ | 110,000 |
The company does not incur any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, Lyons produced 60,000 units and sold 52,000 units. The selling price of the company’s product is $40 per unit.
2. Assume the company uses a variable costing system that assigns $12.50 of direct labor cost to each unit produced:
a. Compute the unit product cost for the year.
b. Prepare an income statement for the year.
3. Reconcile the difference between the super-variable costing and variable costing net operating incomes.
Solutions
ekkarill92 answered 1 year agoRelated Solutions
Bracey Company manufactures and sells one product. The following information pertains to the company’s first year...
Bracey Company manufactures and sells one product. The following
information pertains to the company’s first year of operations:
Variable cost per unit:
Direct materials
$
31
Fixed costs per year:
Direct labor
$
429,000
Fixed manufacturing overhead
$
421,200
Fixed selling and administrative expenses
$
72,000
The company does not incur any variable manufacturing overhead
costs or variable selling and administrative expenses. During its
first year of operations, Bracey produced 26,000 units and sold
23,900 units. The selling price of...
Bracey Company manufactures and sells one product. The following information pertains to the company’s first year...
Bracey Company
manufactures and sells one product. The following information
pertains to the company’s first year of operations:
Variable cost per unit:
Direct materials
$
35
Fixed costs per year:
Direct labor
$
518,000
Fixed manufacturing overhead
$
464,800
Fixed selling and administrative expenses
$
80,000
The company does not
incur any variable manufacturing overhead costs or variable selling
and administrative expenses. During its first year of operations,
Bracey produced 28,000 units and sold 25,500 units. The selling
price of...
Bracey Company manufactures and sells one product. The following information pertains to the company’s first year...
Bracey Company manufactures and sells one product. The following
information pertains to the company’s first year of operations:
Variable cost per unit:
Direct materials
$
21
Fixed costs per year:
Direct labor
$
241,500
Fixed manufacturing overhead
$
319,200
Fixed selling and administrative expenses
$
52,000
The company does not incur any variable manufacturing overhead
costs or variable selling and administrative expenses. During its
first year of operations, Bracey produced 21,000 units and sold
19,900 units. The selling price of...
Bracey Company manufactures and sells one product. The following information pertains to the company’s first year...
Bracey Company manufactures and sells one product. The following
information pertains to the company’s first year of operations:
Variable cost per unit:
Direct materials
$
20
Fixed costs per year:
Direct labor
$
225,500
Fixed manufacturing overhead
$
309,550
Fixed selling and administrative expenses
$
50,000
The company does not incur any variable manufacturing overhead
costs or variable selling and administrative expenses. During its
first year of operations, Bracey produced 20,500 units and sold
19,500 units. The selling price of...
Letcher Corporation manufactures and sells one product. The following information pertains to the company’s first year...
Letcher Corporation manufactures and sells one product. The
following information pertains to the company’s first year of
operations:
Variable costs per unit:
Direct materials
$
94
Fixed costs per year:
Direct labor
$
709,200
Fixed manufacturing overhead
$
4,373,400
Fixed selling and administrative expenses
$
2,244,600
The company does not have any variable manufacturing overhead
costs or variable selling and administrative expenses. During its
first year of operations, the company produced 59,100 units and
sold 57,000 units. The company’s only...
Letcher Corporation manufactures and sells one product. The following information pertains to the company’s first year...
Letcher Corporation manufactures and sells one product. The
following information pertains to the company’s first year of
operations: Variable costs per unit: Direct materials $ 89 Fixed
costs per year: Direct labor $ 616,000 Fixed manufacturing overhead
$ 3,472,000 Fixed selling and administrative expenses $ 1,782,000
The company does not have any variable manufacturing overhead costs
or variable selling and administrative expenses. During its first
year of operations, the company produced 56,000 units and sold
54,000 units. The company’s only...
Kevin company manufactures and sells one product. The following information pertains to the company's first year...
Kevin company manufactures and sells one product. The following
information pertains to the company's first year of operations:
Selling price per unit
$100
Variable costs per unit:
Manufacturing:
Direct materials
$8
Direct labor
$20
Variable manufacturing overhead
$11
Variable selling and administrative expense
$18
Fixed costs per year:
Fixed manufacturing overhead
$48,000
Selling and administrative expense
$65,700
Production
6,000 units
Sales
4,500 units
Q:) What is net operating income under variable costing in the
first year?
A:) $ ________?
Walsh Company manufactures and sells one product. The following information pertains to each of the company’s...
Walsh Company manufactures and sells one product. The following
information pertains to each of the company’s first two years of
operations:
Variable costs per unit:
Manufacturing:
Direct materials
$
20
Direct labor
$
13
Variable manufacturing overhead
$
4
Variable selling and administrative
$
3
Fixed costs per year:
Fixed manufacturing overhead
$
320,000
Fixed selling and administrative expenses
$
70,000
During its first year of operations, Walsh produced 50,000 units
and sold 40,000 units. During its second year of...
Walsh Company manufactures and sells one product. The following information pertains to each of the company’s...
Walsh Company manufactures and sells one product. The following
information pertains to each of the company’s first two years of
operations:
Variable costs per unit:
Manufacturing:
Direct materials
$
29
Direct labor
$
15
Variable manufacturing overhead
$
3
Variable selling and administrative
$
2
Fixed costs per year:
Fixed manufacturing overhead
$
320,000
Fixed selling and administrative expenses
$
70,000
During its first year of operations, Walsh produced 50,000 units
and sold 40,000 units. During its second year of...
Haas Company manufactures and sells one product. The following information pertains to each of the company’s...
Haas Company manufactures and sells one product. The following
information pertains to each of the company’s first three years of
operations:
Variable costs
per unit:
Manufacturing:
Direct
materials
$
28
Direct
labor
$
20
Variable
manufacturing overhead
$
4
Variable selling
and administrative
$
3
Fixed costs per
year:
Fixed
manufacturing overhead
$
210,000
Fixed selling
and administrative expenses
$
150,000
During its first year of operations, Haas produced 60,000 units
and sold 60,000 units. During its second year of...
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