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HW 7 - Chapter 6 A Saved Help Save & Exit Submit Check my work During Heaton Company's first two years of operations, it reported
HW 7 - Chapter 6 A Saved Help Save & Exit Submit Check my work During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows: $ 1.88 points Sales (@ $61 per unit) Cost of goods sold ($39 per unit) Gross margin Selling and administrative expenses Net operating income Year 1 976,000 624,000 352,000 297,000 55,000 Year 2 $1,516,000 1,014,000 572,000 327,000 $ 245,000 $ eBook *$3 per unit variable: $249,000 fixed each year. The company's $39 unit product cost is computed as follows: Ask References Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead ($999,000 - 21.000 units) Absorption coating unit product coat 19 $ 39 Forty percent of fixed manufacturing overhead consists of wages and salarles; the remainder consists of depreciation charges on production equipment and buildings. Production and cost data for the first two years of operations are: Units produced Unita sold Year 1 21,000 16.000 Year 2 21,000 26,000 Required: 1. Using variable costing, what is the unit product cost for both years? 2. What is the variable costing net operating income in Year 1 and in Year 2? 3. Reconcile the absorption costing and the variable costing net operating income figures for each year
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