Information from Jacob Perez Company's records is available as follows for the year ended December 31, 2017:
Question:
Information from Jacob Perez Company's records is available as follows for the year ended
December 31, 2017:
Net sales.....................................................................$1,600,000
Cost of goods manufactured:
Variable........................................................................$ 800,000
Fixed.............................................................................352,000
Operating expenses:
Variable........................................................................$ 78,000
Fixed............................................................................150,000
Units manufactured.............................................................80,000
Units sold.........................................................................55,000
Finished goods inventory, 1/1/2017............................................None
No work-in-process inventories existed at the beginning or end of 2017.
Required:
1. What would be Perez's finished goods inventory and cost of goods sold under the variable (direct) costing method at December 31, 2017?
2. Under the absorption costing method, what would Perez's operating income be?
3. Calculate Jacob Perez Company's cost of goods sold and ending inventory under absorption costing.
Ending InventoryThe ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula Ending Inventory Formula =...
Step by Step Answer:
Requirement 1 Finished goods inventory under variable direct costing To begin we know cost of goods manufactured and the beginning balance We need to ...View the full answer
Financial Reporting and Analysis
ISBN: 978-1259722653
7th edition
Authors: Lawrence Revsine, Daniel Collins, Bruce Johnson, Fred Mittelstaedt, Leonard Soffer
