Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Denton Company manufactures and sells a single product. Cost data for the product are given: Denton Company manufactures and sells a single product. Cost data
Denton Company manufactures and sells a single product. Cost data for the product are given:
Denton Company manufactures and sells a single product. Cost data for the product are given: $ 4 10 2 1 Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Total variable cost per unit Fixed costs per month: Fixed manufacturing overhead Fixed selling and administrative Total fixed cost per month $ 17 $ 180,000 166,000 $ 346,000 The product sells for $52 per unit. Production and sales data for July and August, the first two months of operations, follow: Units Sold Units Produced 30,000 30,000 July 26,000 34,000 August The company's Accounting Department has prepared the following absorption costing income statements for July and August Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating income July August $ 1,352,000 $ 1,768,000 572,000 748,000 780,000 1,020,000 192,000 200,000 $ 588,000 $ 820,000 Required: 1. Determine the unit product cost under: a. Absorption costing. b. Variable costing. 2. Prepare variable costing income statements for July and August. 3. Reconcile the variable costing and absorption costing net operating incomes. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Determine the unit product cost under: (a) Absorption costing, (b) Variable costing. Unit Product Cost a. Absorption costing b. Variable costing Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare variable costing income statements for July and August. Denton Company Variable Costing Income Statement July August Net operating income (loss) Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Reconcile the variable costing and absorption costing net operating incomes. (Enter any losses or deductions as a negative value.) Reconciliation of Variable Costing and Absorption Costing Net Operating Incomes July August Variable costing net operating income (loss) Add (deduct) fixed manufacturing overhead cost deferred in (released from) inventory under absorption costing Absorption costing net operating income (loss)Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started