28.

Problem 8-5 Buttons Company produces three products: LMC, DMC, KPC. For the coming year they expect to produce 160,000 units. Of these, 65,000 will be LMC, 40,000 will be DMC and 55,000 will be KPC. The following information was provided for the coming year: DMC $860 405 210 72 60 425,000 LMC $550 250 180 60 45 240,000 $625 300 205 Price Unit direct materials Unit direct labor Unit variable overhead Unit variable selling expense Total direct fixed overhead Common fixed overhead is $984,000 and fixed selling and administrative expenses for Buttons Company is $881,000 per year 58 400,000 Required: A. Calculate the unit variable cost under variable costing. Total Variable Cost LMC DMC B. Calculate the unit variable product cost. Total Unit Variable Product Cost LMC DMC C. Prepare a segmented variable-costing income statement for next year Buttons Company Segmented Variable-Costing Income Statement LMC DMCKPC Sales Variable cost of goods sold Variable selling expense Contribution margin Less: direct fixed overhead Segment margin Less: common fixed expenses: Common fixed overhead Common selling and administrative Operating income D. Should Buttons Company keep all product lines