Flow of Costs and Income Statement Ginocera Inc. is a designer, manufacturer, and distributor of low-cost, high-quality stainless steel kitchen knives, A new kitchen knife series called the Kitchen Ninja was released for production in early 20Y8. In January, the company spent $325,500 to develop a latenight advertising infomercial for the new product. During 20Y8, the company spent $759,500 advertising the product through these infomercials. In addition, the company incurred $326,000 in legal costs, The knives were ready for manufacture on January 1,20 , Ginocera uses a job order cost system to accumulate costs associated with the kitchen knife. The unit direct materials cost for the knife is as follows: The production process is straightforward. First, the hardened steel blanks, which are purchased directly from a raw material supplier are stamped into a single piece of metal that includes both the blade and the shaft. The stamping machine requires one hour per 720 knives. After the knife shafts are stamped, they are brought to an assembly area where an employee attaches the handle to the shaft and packs the knife in a decorative box. The direct labor cost is $0.20 per unit. The knives are sold to stores. Each store is given promotional materials such as posters and aisle displays. Promotional materials cost $35 per store. In addition, shipping costs average $0.2 per knife. Total completed production was 310,000 units during the year. Other information is as follows: Factory overhead cost is applied to jobs at the rate of $360 per stampino machine hour after the knife blanks are stamped. There were an additional 77,500 stamped knives, handles, and cases waiting to be assembled on December 31,20 . In your computations, if required, round interim per unit costs to two decimal places. Flow of Costs and Income Statement Ginocera Inc, is a designer, manufacturer, and distributor of low-cost, high-quality stainless steel kitchen knives. A new kitchen knife series called the Kitchen Ninja was released for production in early 20Y8. In January, the company spent $325,500 to develop a late-night advertising infomercial for th new product. During 20Y8, the company spent $759,500 advertising the product through these infomerciais. In addition, the company incurred $326,000 in legal costs. The knives were ready for manufacture on January 1,20Y. Ginocera uses a job order cost system to accumulate costs associated with the kitchen knife. The unit direct materials cost for the knife is as follows: The production process is straightforward. First, the hardened steel blanks, which are purchased directly from a raw material supplier, are stamped into a single plece of metal that indudes both the blade and the shaft. The stamping machine requires one hour per 720knives. After the knife shafts are stamped, they are brought to an assembly area where an employee attaches the handle to the shaft and packs the knife in a decorative box. The direct labor cost is $0.20 per unit. The knives are sold to stores. Each store is given promotional materials such as posters and aisle displays. Promotional materials cost 535 per store. In addition, shipping costs average 50.2 per knife. Total completed production was 310,000 units during the vear, Other information is as follows: Factory overhead cost is applied to 106 of the rote of $360 per stamping machine hout atter the knife blanks are stamped, There were an additional 77,500 stamped knives, handles, and caseo watina to be assembled on December 31,20v. In your computations, if requred, round interim per unt costs to two decimal places. 77,500 stamped knives, handles, and cases waiting to be assembled on December 31,20 Y. In your computations, if required, round interim per unit costs to two decimal places. Required: 1. Prepare an annual income statement for the Kitchen Ninja knife senes. Fwaback F Check My Wbit. 1. a. Calculate the sales revenue. b. Calculate the manufacturing cost per unit (direct and indirect costs). c. Assign all the manufacturing costs per unit to the number of units sold. d. Assign all the promotional costs to the stores: 2. Determine the balances in the work in process and finished goods inventories for the Kitchen Nirja knife series on December 31, 20y3. Finished Goods Work in Process
