Question
Please assist with the below question. I provided my answers which were wrong. Would like to figure out where I went wrong. ABC Company manufactures
Please assist with the below question. I provided my answers which were wrong. Would like to figure out where I went wrong.
ABC Company manufactures an electronic device. Last year, the per-unit product cost was $60, the per-unit prime cost was $38, and the per-unit conversion cost was $45. Cost of goods sold for the year was $600,000 and the sale price per unit was $110. In addition, direct labor costs of $210,000 and selling and administrative expenses of $250,000 were incurred.
Required:
A. Calculate how many units were sold last year
600,000/45+38
600,000/83=7,228.915
7,228 units were sold last year
B. Compute the cost of direct materials used
Total units sold per year * 60= cost of direct materials used
7,228*60=$433,680.00
C. Compute the cost of overhead
Direct labor costs +selling and administrative expenses
210,000+250,000=460,000
D. Compute the gross margin for the year
7,228*110=795,080
795,080-460,000=335,080
E. Calculate operating income
(7,228 * $110)-($600,000+210,000+250,000)
795,080-1,060,000
[(110)*(7,228)-($45)*(7,228)]-($60)=5,746,512,920
[795,080-325,260]
459,820-60=469,760
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