1 Inventory Valuation under Absorption Costing During the most recent year, Judson Company had the following data associated with the product it makes Units in beginning inventory 300 Units produced 14,000 Units sold ($300 per unit) 12,700 Variable costs per unit Direct materials $20 Direct labor $60 Variable overhead $13 Fixed costs Fixed overhead per unit produced $30 Fixed selling and administrative $140,000 Required 1 How many units are in ending inventory units 2 Using absorption costing, calculate the per unit product cost $ per unit 3 What is the value of ending inventory under absorption costing $ 2 Inventory Valuation under Variable Costing During the most recent year, Judson Company had the following data associated with the product it makes Units in beginning inventory 300 Units produced 14,000 Units sold ($300 per unit) 12,700 Variable costs per unit Direct materials $20 Direct labor $60 Variable overhead $10 Fixed costs Fixed overhead per unit produced $30 Fixed selling and administrative $140,000 Required 1 How many units are in ending inventory units 2 Using variable costing, calculate the per unit product cost $ per unit 3 What is the value of ending inventory under variable costing $ 3 Absorption Costing Income Statement During the most recent year, Osterman Company had the following data Units in beginning inventory Units produced 10,000 Units sold ($47 per unit) 9,200 Variable costs per unit Direct materials $9 Direct labor $6 Variable overhead $4 Fixed costs Fixed overhead per unit produced $5 Fixed selling and administrative $138,000 Required 1 Calculate the cost of goods sold under absorption costing $ 6 Ordering Cost, Carrying Cost, and Total Inventory Related Cost La Cucina Company sells kitchen supplies and housewares Lava stone is used in production of molcajetes (mortars and pestles used in the making of guacamole) and is purchased from external suppliers Each year, 9,500 pounds of lava stone is used it is currently purchased in lots of 500 pounds It costs La Cucina $5 to place the order, and carrying cost is $2 per pound per year Required 1 How many orders for lava stone does La Cucina place per year Round your answer to the nearest whole amount orders per year 2 What is the total ordering cost of lava stone per year $ 3 What is the total carrying cost of lava stone per year $ 4 What is the total cost of La Cucina's inventory policy for lava stone per year $ 7 Economic Order Quantity La Cucina Company sells kitchen supplies and housewares Lava stone is used in production of molcajetes (mortars and pestles used in the making of guacamole) and is purchased from external suppliers Each year, 8,200 pounds of lava stone is used it is currently purchased in lots of 500 pounds It costs La Cucina $6 to place the order, and carrying cost is $2 per pound per year Required 1 What is the EOQ for lava stone Round your answer to the nearest whole pound pounds 2 How many orders per year for lava stone will La Cucina place under the EOQ policy Round your answer to the nearest whole order orders per year 3 What is the total annual ordering cost of lava stone for a year under the EOQ policy Round your answer to the nearest dollar $ 4 What is the total annual carrying cost of lava stone per year under the EOQ policy Round your answer to the nearest dollar $ 5 What is the total annual inventory related cost for lava stone under the EOQ $ 8 Reorder Point La Cucina Company sells kitchen supplies and housewares Lava stone is used in production of molcajetes (mortars and pestles used in the making of guacamole) and is purchased from external suppliers Each year, 8,000 pounds of lava stone is used it is used evenly at the rate of 28 pounds per day It takes La Cucina 7 days from the time of order to the time of arrival of the order Required Calculate the reorder point pounds Gorman Nurseries Inc grows poinsettias and fruit trees in a green houseursery operation The following information was provided for the coming year Poinsettias Fruit Trees Sales $960,000 $3,220,000 Variable cost of goods sold 460,000 1,630,000 Direct xed overhead 160,000 200,000 A sales commission of 4 of sales is paid for each of the two product lines Direct xed sell ing and administrative expense was estimated to be $146,000 for the poinsettia line and $87,000 for the fruit tree line Common xed overhead for the nursery operation was estimated to be $800,000 common selling and administrative expense was estimated to be $450,000 Requuired Prepare a segmented income statement for Gorman Nurseries for the coming year, using vari able costing Gorman Nurseries Inc Segmented Income Statement Poinsettias Fruit Trees Total Sales $960,000 $3,100,000 Variable cost of goods sold $(460,000) $(1,600) Variable selling expense Contribution margin Less direct xed expenses Direct xed overhead $(160,000) $(200,000) $(360,000) Direct selling and administrative Segment margin Less common xed expenses Common xed overhead Common selling and administrative Operating income 1 Inventory Valuation under Absorption Costing During the most recent year, Judson Company had the following data associated with the product it makes Units in beginning inventory 300 Units produced 14,000 Units sold ($300 per unit) 12,700 Variable costs per unit Direct materials $20 Direct labor $60 Variable overhead $13 Fixed costs Fixed overhead per unit produced Fixed selling and administrative $30 $140,000 Required 1 How many units are in ending inventory units 2 Using absorption costing, calculate the perunit product cost $ per unit 3 What is the value of ending inventory under absorption costing $ 2 Inventory Valuation under Variable Costing During the most recent year, Judson Company had the following data associated with the product it makes Units in beginning inventory 300 Units produced 14,000 Units sold ($300 per unit) 12,700 Variable costs per unit Direct materials $20 Direct labor $60 Variable overhead $10 Fixed costs Fixed overhead per unit produced $30 Fixed selling and administrative $140,000 Required 1 How many units are in ending inventory units 2 Using variable costing, calculate the perunit product cost $ per unit 3 What is the value of ending inventory under variable costing $ 3 AbsorptionCosting Income Statement During the most recent year, Osterman Company had the following data Units in beginning inventory Units produced Units sold ($47 per unit) Variable costs per unit 10,000 9,200 Direct materials $9 Direct labor $6 Variable overhead $4 Fixed costs Fixed overhead per unit produced Fixed selling and administrative Required 1 Calculate the cost of goods sold under absorption costing $ $5 $138,000 6 Ordering Cost, Carrying Cost, and Total InventoryRelated Cost La Cucina Company sells kitchen supplies and housewares Lava stone is used in production of molcajetes (mortars and pestles used in the making of guacamole) and is purchased from external suppliers Each year, 9,500 pounds of lava stone is used it is currently purchased in lots of 500 pounds It costs La Cucina $5 to place the order, and carrying cost is $2 per pound per year Required 1 How many orders for lava stone does La Cucina place per year Round your answer to the nearest whole amount orders per year 2 What is the total ordering cost of lava stone per year $ 3 What is the total carrying cost of lava stone per year $ 4 What is the total cost of La Cucina's inventory policy for lava stone per year $ 7 Economic Order Quantity La Cucina Company sells kitchen supplies and housewares Lava stone is used in production of molcajetes (mortars and pestles used in the making of guacamole) and is purchased from external suppliers Each year, 8,200 pounds of lava stone is used it is currently purchased in lots of 500 pounds It costs La Cucina $6 to place the order, and carrying cost is $2 per pound per year Required 1 What is the EOQ for lava stone Round your answer to the nearest whole pound pounds 2 How many orders per year for lava stone will La Cucina place under the EOQ policy Round your answer to the nearest whole order orders per year 3 What is the total annual ordering cost of lava stone for a year under the EOQ policy Round your answer to the nearest dollar $ 4 What is the total annual carrying cost of lava stone per year under the EOQ policy Round your answer to the nearest dollar $ 5 What is the total annual inventoryrelated cost for lava stone under the EOQ $ 8 Reorder Point La Cucina Company sells kitchen supplies and housewares Lava stone is used in production of molcajetes (mortars and pestles used in the making of guacamole) and is purchased from external suppliers Each year, 8,000 pounds of lava stone is used it is used evenly at the rate of 28 pounds per day It takes La Cucina 7 days from the time of order to the time of arrival of the order Required Calculate the reorder point pounds Gorman Nurseries Inc grows poinsettias and fruit trees in a green houseursery operation The following information was provided for the coming year Sales Variable cost of goods sold Direct xed overhead Poinsettias $960,000 460,000 160,000 Fruit Trees $3,220,000 1,630,000 200,000 A sales commission of 4 of sales is paid for each of the two product lines Direct xed selling and administrative expense was estimated to be $146,000 for the poinsettia line and $87,000 for the fruit tree line Common xed overhead for the nursery operation was estimated to be $800,000 common selling and administrative expense was estimated to be $450,000 Requuired Prepare a segmented income statement for Gorman Nurseries for the coming year, using variable costing Gorman Nurseries Inc Segmented Income Statement Sales Variable cost of goods sold Variable selling expense Contribution margin Less direct xed expenses Direct xed overhead Direct selling and administrative Segment margin Less common xed expenses Common xed overhead Common selling and administrative Operating income Poinsettias Fruit Trees $ 960,000 $ 3,100,000 $ (460,000) $ (1,600) Total $ (160,000) $ (200,000) $ (360,000)

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1. Inventory Valuation under Absorption Costing During the most recent year, Judson Company had the following data associated with the product it makes: Units in

Inventory Valuation under Absorption Costing

During the most recent year, Judson Company had the following data associated with the product it makes:

Units in beginning inventory	300
Units produced	14,000
Units sold ($300 per unit)	12,700
Variable costs per unit:
Direct materials	$20
Direct labor	$60
Variable overhead	$13
Fixed costs:
Fixed overhead per unit produced	$30
Fixed selling and administrative	$140,000

Required:

1. How many units are in ending inventory? _________________ units

2. Using absorption costing, calculate the per-unit product cost. $ _________________ per unit

3. What is the value of ending inventory under absorption costing? $ _________________

Inventory Valuation under Variable Costing

During the most recent year, Judson Company had the following data associated with the product it makes:

Units in beginning inventory	300
Units produced	14,000
Units sold ($300 per unit)	12,700
Variable costs per unit:
Direct materials	$20
Direct labor	$60
Variable overhead	$10
Fixed costs:
Fixed overhead per unit produced	$30
Fixed selling and administrative	$140,000

Required:

1. How many units are in ending inventory? _________________ units

2. Using variable costing, calculate the per-unit product cost. $ _________________ per unit

3. What is the value of ending inventory under variable costing? $ _________________

Absorption-Costing Income Statement

During the most recent year, Osterman Company had the following data:

Units in beginning inventory	?
Units produced	10,000
Units sold ($47 per unit)	9,200
Variable costs per unit:
Direct materials	$9
Direct labor	$6
Variable overhead	$4
Fixed costs:
Fixed overhead per unit produced	$5
Fixed selling and administrative	$138,000

Required:

1. Calculate the cost of goods sold under absorption costing. $ _________________

Ordering Cost, Carrying Cost, and Total Inventory-Related Cost

La Cucina Company sells kitchen supplies and housewares. Lava stone is used in production of molcajetes (mortars and pestles used in the making of guacamole) and is purchased from external suppliers. Each year, 9,500 pounds of lava stone is used; it is currently purchased in lots of 500 pounds. It costs La Cucina $5 to place the order, and carrying cost is $2 per pound per year.

Required:

1. How many orders for lava stone does La Cucina place per year? Round your answer to the nearest whole amount. _________________ orders per year

2. What is the total ordering cost of lava stone per year? $ _________________

3. What is the total carrying cost of lava stone per year? $ _________________

4. What is the total cost of La Cucina's inventory policy for lava stone per year? $ _________________

Economic Order Quantity

La Cucina Company sells kitchen supplies and housewares. Lava stone is used in production of molcajetes (mortars and pestles used in the making of guacamole) and is purchased from external suppliers. Each year, 8,200 pounds of lava stone is used; it is currently purchased in lots of 500 pounds. It costs La Cucina $6 to place the order, and carrying cost is $2 per pound per year.

Required:

1. What is the EOQ for lava stone? Round your answer to the nearest whole pound. _________________ pounds

2. How many orders per year for lava stone will La Cucina place under the EOQ policy? Round your answer to the nearest whole order. _________________ orders per year

3. What is the total annual ordering cost of lava stone for a year under the EOQ policy? Round your answer to the nearest dollar. $ _________________

4. What is the total annual carrying cost of lava stone per year under the EOQ policy? Round your answer to the nearest dollar. $ _________________

5. What is the total annual inventory-related cost for lava stone under the EOQ? $ _________________

Reorder Point

La Cucina Company sells kitchen supplies and housewares. Lava stone is used in production of molcajetes (mortars and pestles used in the making of guacamole) and is purchased from external suppliers. Each year, 8,000 pounds of lava stone is used; it is used evenly at the rate of 28 pounds per day. It takes La Cucina 7 days from the time of order to the time of arrival of the order.

Required:

Calculate the reorder point. _________________ pounds

Gorman Nurseries Inc. grows poinsettias and fruit trees in a green houseursery operation. The
following information was provided for the coming year.

				Poinsettias	Fruit Trees
	Sales	$960,000	$3,220,000
	Variable cost of goods sold	460,000	1,630,000
	Direct ?xed overhead	160,000	200,000

A sales commission of 4% of sales is paid for each of the two product lines. Direct ?xed sell-
ing and administrative expense was estimated to be $146,000 for the poinsettia line and $87,000
for the fruit tree line.
Common ?xed overhead for the nursery operation was estimated to be $800,000; common
selling and administrative expense was estimated to be $450,000.
Requuired:
Prepare a segmented income statement for Gorman Nurseries for the coming year, using vari-
able costing.
				Gorman Nurseries Inc.
				Segmented Income Statement

					Poinsettias	Fruit Trees	Total
	Sales				$960,000	$3,100,000	?
	Variable cost of goods sold		$(460,000)	$(1,600)	?
	Variable selling expense*			?	?	?
	Contribution margin			?	?	?
	Less direct ?xed expenses:
	Direct ?xed overhead			$(160,000)	$(200,000)	$(360,000)
	Direct selling and administrative		?	?	?
	Segment margin			?	?	?
	Less common ?xed expenses:
	Common ?xed overhead					?
	Common selling and administrative				?
	Operating income					?

1. Inventory Valuation under Absorption Costing During the most recent year, Judson Company had the following data associated with the product it makes: Units in beginning inventory 300 Units produced 14,000 Units sold ($300 per unit) 12,700 Variable costs per unit: Direct materials $20 Direct labor $60 Variable overhead $13 Fixed costs: Fixed overhead per unit produced Fixed selling and administrative $30 $140,000 Required: 1. How many units are in ending inventory? _________________ units 2. Using absorption costing, calculate the perunit product cost. $ _________________ per unit 3. What is the value of ending inventory under absorption costing? $ _________________ 2. Inventory Valuation under Variable Costing During the most recent year, Judson Company had the following data associated with the product it makes: Units in beginning inventory 300 Units produced 14,000 Units sold ($300 per unit) 12,700 Variable costs per unit: Direct materials $20 Direct labor $60 Variable overhead $10 Fixed costs: Fixed overhead per unit produced $30 Fixed selling and administrative $140,000 Required: 1. How many units are in ending inventory? _________________ units 2. Using variable costing, calculate the perunit product cost. $ _________________ per unit 3. What is the value of ending inventory under variable costing? $ _________________ 3. AbsorptionCosting Income Statement During the most recent year, Osterman Company had the following data: Units in beginning inventory Units produced Units sold ($47 per unit) Variable costs per unit: 10,000 9,200 Direct materials $9 Direct labor $6 Variable overhead $4 Fixed costs: Fixed overhead per unit produced Fixed selling and administrative Required: 1. Calculate the cost of goods sold under absorption costing. $ _________________ $5 $138,000 6. Ordering Cost, Carrying Cost, and Total InventoryRelated Cost La Cucina Company sells kitchen supplies and housewares. Lava stone is used in production of molcajetes (mortars and pestles used in the making of guacamole) and is purchased from external suppliers. Each year, 9,500 pounds of lava stone is used; it is currently purchased in lots of 500 pounds. It costs La Cucina $5 to place the order, and carrying cost is $2 per pound per year. Required: 1. How many orders for lava stone does La Cucina place per year? Round your answer to the nearest whole amount. _________________ orders per year 2. What is the total ordering cost of lava stone per year? $ _________________ 3. What is the total carrying cost of lava stone per year? $ _________________ 4. What is the total cost of La Cucina's inventory policy for lava stone per year? $ _________________ 7. Economic Order Quantity La Cucina Company sells kitchen supplies and housewares. Lava stone is used in production of molcajetes (mortars and pestles used in the making of guacamole) and is purchased from external suppliers. Each year, 8,200 pounds of lava stone is used; it is currently purchased in lots of 500 pounds. It costs La Cucina $6 to place the order, and carrying cost is $2 per pound per year. Required: 1. What is the EOQ for lava stone? Round your answer to the nearest whole pound. _________________ pounds 2. How many orders per year for lava stone will La Cucina place under the EOQ policy? Round your answer to the nearest whole order. _________________ orders per year 3. What is the total annual ordering cost of lava stone for a year under the EOQ policy? Round your answer to the nearest dollar. $ _________________ 4. What is the total annual carrying cost of lava stone per year under the EOQ policy? Round your answer to the nearest dollar. $ _________________ 5. What is the total annual inventoryrelated cost for lava stone under the EOQ? $ _________________ 8. Reorder Point La Cucina Company sells kitchen supplies and housewares. Lava stone is used in production of molcajetes (mortars and pestles used in the making of guacamole) and is purchased from external suppliers. Each year, 8,000 pounds of lava stone is used; it is used evenly at the rate of 28 pounds per day. It takes La Cucina 7 days from the time of order to the time of arrival of the order. Required: Calculate the reorder point. _________________ pounds Gorman Nurseries Inc. grows poinsettias and fruit trees in a green houseursery operation. The following information was provided for the coming year. Sales Variable cost of goods sold Direct xed overhead Poinsettias $960,000 460,000 160,000 Fruit Trees $3,220,000 1,630,000 200,000 A sales commission of 4% of sales is paid for each of the two product lines. Direct xed selling and administrative expense was estimated to be $146,000 for the poinsettia line and $87,000 for the fruit tree line. Common xed overhead for the nursery operation was estimated to be $800,000; common selling and administrative expense was estimated to be $450,000. Requuired: Prepare a segmented income statement for Gorman Nurseries for the coming year, using variable costing. Gorman Nurseries Inc. Segmented Income Statement Sales Variable cost of goods sold Variable selling expense* Contribution margin Less direct xed expenses: Direct xed overhead Direct selling and administrative Segment margin Less common xed expenses: Common xed overhead Common selling and administrative Operating income Poinsettias Fruit Trees $ 960,000 $ 3,100,000 $ (460,000) $ (1,600) Total ? ? ? ? ? ? ? ? $ (160,000) $ (200,000) $ (360,000)