Deluxe Homes is a residential Home Builder. Based on their current production of 300 homes per year,
Question:
Deluxe Homes is a residential Home Builder. Based on their current production of 300 homes per year, they currently make a profit of $20,000 per unit, based on the following costs per unit: Direct labor $ 20,000 Direct materials 200,000 Variable overhead 30,000 Fixed overhead 40,000 Variable selling costs 10,000 Fixed selling costs 10,000 Total costs per unit $310,000 Required Each of these are separate situations.
A. Prepare an income statement based on the information provided.
B. What is the profit and cost per unit if production is increased to 400 homes per year, and there is an increase of $1.50 million in total fixed overhead costs?
Management Accounting
ISBN: 978-0132570848
6th Canadian edition
Authors: Charles T. Horngren, Gary L. Sundem, William O. Stratton, Phillip Beaulieu