Business, 05.05.2020 05:01 zeinabelsiblini

Ncome Statements under Absorption Costing and Variable Costing

Fresno Industries Inc. manufactures and sells high-quality camping tents. The company began operations on January 1 and operated at 100% of capacity (150,000 units) during the first month, creating an ending inventory of 20,000 units. During February, the company produced 130,000 units during the month but sold 150,000 units at $500 per unit. The February manufacturing costs and selling and administrative expenses were as follows:

Number of Units Unit Cost Total Cost
Manufacturing costs in February 1 beginning inventory:
Variable 20,000 $275.00 $5,500,000
Fixed 20,000 26.00 520,000
$301.00 $6,020,000
Total Manufacturing costs in February:
Variable 130,000 $275.00 $35,750,000
Fixed 130,000 30.00 3,900,000
$305.00 $39,650,000
Total Selling and administrative expenses in February:
Variable 150,000 $20.00 $3,000,000
Fixed 150,000 1.30 195,000
$21.30 $3,195,000

Prepare an income statement according to the absorption costing concept for the month ending February 28.

Answers: 1

Show answers

Another question on Business

Business, 21.06.2019 21:00

The market for corn in country a is highly competitive. at the current market price of $5/bushel there is a shortage of 100,000 bushels of corn in this country. media reports claim that the price of corn will rise drastically in the near future. according to these reports, the neighboring country b had witnessed a similar situation recently. at the same price, the shortage in country b was also 100,000 bushels and eventually the equilibrium price in b went up to $10/bushel. both countries are known to have equal number of corn producers and the market supply of corn is identical at all prices. this, combined with the fact that consumers in the two countries also have similar tastes and preferences, led the media to conclude that the price of corn in country a would soon be as high as $10/bushel. the new equilibrium price turns out to be below $10/bushel, what inferences can be drawn?

Answers: 3

Answer

Business, 22.06.2019 06:30

If a team of three workers, each making the u.s. federal minimum wage, produced these 12 rugs, what would the total labor cost be? don't forget that these workers would be working overtime.

Answers: 3

Answer

Business, 22.06.2019 06:40

As a finance manager at allsports communication, charlie worries about the firm's borrowing requirements for the upcoming year. he knows the benefit of estimating allsports' cash disbursements and short-term investment expectations. facing these concerns, a(n) would provide charlie with valuable information by providing a good estimation of whether the firm will need to do short-term borrowing. capital budget cash budget operating budget line item budget

Answers: 3

Answer

Business, 22.06.2019 09:40

Henry crouch's law office has traditionally ordered ink refills 55 units at a time. the firm estimates that carrying cost is 35% of the $11 unit cost and that annual demand is about 240 units per year. the assumptions of the basic eoq model are thought to apply. for what value of ordering cost would its action be optimal? a) for what value of ordering cost would its action be optimal?

Answers: 2

Answer

You know the right answer?

Ncome Statements under Absorption Costing and Variable Costing

Fresno Industries Inc. m...

Questions