Question
During 2020, Rafael Corp. produced 27,120 units and sold 27,120 for $14 per unit. Suppose the accountant for Rafael Corp. uses normal costing and uses
During 2020, Rafael Corp. produced 27,120 units and sold 27,120 for $14 per unit. Suppose the accountant for Rafael Corp. uses normal costing and uses the budgeted volume of 45,200 units. Variable manufacturing costs were $6 per unit. Annual fixed manufacturing overhead was $54,240 ($3 per unit). Variable selling and administrative costs were $2 per unit sold, and fixed selling and administrative expenses were $36,160. The company expenses production volume variance to cost of goods sold in the accounting period in which it occurs.
i was wondering if my answers in b are correct. thank you!
(a) Your answer is correct. Calculate the manufacturing cost per unit. (Round answer to 2 decimal places, e.g. 5.25.) Manufacturing cost 7.2 $ per unit (b) Prepare a normal-costing income statement for the first year of operation. Rafael Corp Income Statement-Normal Costing For the Year Ended December 31, 2020 Sales 379,680 Cost of goods sold Beginning inventory 0 Add Costs of goods manufactured 298,320 Cost of goods sold 298,320 Add. Volume variance (81,360) 216,960 Gross margin 162,720 Less v. Selling and administrative expenses 90,400 Operating income before tax $ 72,320Step by Step Solution
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