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Kate's Kale Chips produces a healthy snack made primarily of kale. Each bag of the product sells for $5. The company computes the manufacturing overhead
Kate's Kale Chips produces a healthy snack made primarily of kale. Each bag of the product sells for $5. The company computes the manufacturing overhead rate on a quarterly basis based upon the planned number of units to be produced that quarter. The following data are from the projections of Kate's Kale Chips for the upcoming quarter: Projections Sales 26,500 bags Production 28,500 bags Variable manufacturing cost per bag $ 3.30 Sales and distribution costs per bag $ 0.30 Total fixed manufacturing overhead $ 45,600 Fixed administrative overhead $ 24,500 Required: 1. Compute the projected product cost per bag produced under full costing. 2. Compute the projected product cost per bag under variable costing. (Round your answers to 2 decimal places.) 1. Product cost under full costing 2. Product cost under variable costing per bag per bag Start Me Up Incorporated manufactures a caffeinated energy drink that sells for $4.70 each. The results for its first year of operations appear in the table below: Number of drinks produced Number of drinks sold Direct materials per drink Direct labor per drink Variable manufacturing overhead per drink Total fixed manufacturing overhead Total fixed selling and administrative costs Projections 51,000 46,600 $ 0.62 $ 0.32 $ 0.22 $ 33,660 $ 53,500 Required: 1. Compute the operating income for the first year under full costing. 2. Compute the operating income for the first year under variable costing. (For all requirements, do not round intermediate calculations.) 1. Operating income for the first year under full costing 2. Operating income for the first year under variable costing DI
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