Chapter 6 Applying Excel (A)i Saved Help Save & Exit Check 2 Required information f the Review Problem in the text The Chapter 6 Form worksheet is to be used to create your own worksheet version Part 2 of 2 2. Change all the numbers in the data area of your worksheet so that it looks like this: 1C points A B C Chapter 6: Applying Excel eBook Data Print 377 Selling price per unit References Manufacturing costs 5 Variable per unit produced: 7 Direct materials 144 Direct labon 62 Variable manufacturing overhead 37 10 Fixed manufacturing overhead per year 160,000 Selling and administrative expenses: 11 12 Variable per unit sold 4 13 83.000 Fixed per year 14 15 Year 1 Year 2 16 Units in beginning inventory 0 Units produced during the year 17 3.200 2,500 18 Units sold during the year 2.800 2,800 2 Required information Part 2 of 2 If your formulas are correct, you should get the correct answers to the following questions. (a) What is the net operating income (loss) in Year 1 under absorption costing? 10 points eBook Print References (b) What is the net operating income (loss) in Year 2 under absorption costing? Required information Part 2 of 2 (c) What is the net operating income (loss) in Year 1 under variable costing? 10 points eBook Print References (d) What is the net operating income (loss) in Year 2 under variable costing? my work 2 Required information (e) The net operating income (loss) under absorption costing is less than the net operating income (loss) under variable costing in Year 2 because: (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box fora wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.) Part 2 of 2 10 points Units were left over from the previous year The cost of goods sold is always less under variable costing than under absorption costing. eBook Sales exceeded production so some of the fixed manufacturine orhead of the period was released from inventories under absorption costing. Print References 3 Make a note of the absorption costing net operating income (loss) in Year 2. At the end of Year 1, the company's board of directors set a target for Year 2 of net operating income of $190,000 under absorption costing. If this target is met, a hefty bonus would be paid to the CEO of the company. Keeping everything else the same from part (2) above, change the units produced in Year 2 to 5,000 units (a) Would this change result in a bonus being paid to the CEO? O Yes O No Required information Part 2 of 2 (b) What is the net operating income (loss) in Year 2 under absorption costing? 10 points eBook Print References (c) Would this doubling of production in Year 2 be in the best interests of the company if sales are expected to continue to be 2,800 units per year? O Yes O No
