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I'm not sure if what I have is correct for Requirment 3 During Heaton Company's first two years of operations, it reported absorption costing net
I'm not sure if what I have is correct for Requirment 3
During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows Year 1 Year 2 Sales ( $25 per unit) Cost of goods sold ( $18 per unit) Gross margin Selling and administrative expenses* Net operating income $ 1,000,000 1,250,000 900,000 350,000 230,000 $ 70,000 120,000 720,000 280,000 210,000 $2 per unit variable; $130,000 fixed each year. The company's $18 unit product cost is computed as follows Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead ($270,000 45,000 units) Absorption costing unit product cost $ 18 Forty percent of fixed manufacturing overhead consists of wages and salaries, the remainder consists of depreciation charges orn production equipment and buildings Production and cost data for the first two years of operations areStep by Step Solution
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