Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Problem 6-22 Variable Costing Income Statements; Income Reconciliation [LO6-1, LO6-2, LO6-3] Denton Company manufactures and sells a single product. Cost data for the product are
Problem 6-22 Variable Costing Income Statements; Income Reconciliation [LO6-1, LO6-2, LO6-3] Denton Company manufactures and sells a single product. Cost data for the product are given: Variable costs per unit: Direct materials 5 Direct labor 10 Variable manufacturing overhead Variable selling and administrative 4 $ 21 Total variable cost per unit Fixed costs per month: Fixed manufacturing overhead Fixed selling and administrative Total fixed cost per month 135,000 169,000 304,000 The product sells for $54 per unit. Production and sales data for July and August, the first two months of operations, follow: Units Units Sold Produced 27,000 27,000 July August 23,000 31,000 The company's Accounting Department has prepared the following absorption costing income statements for July and August: July $1,242,000 August 1,674,000 744,000 Sales Cost of goods sold Gross margin Selling and administrative expenses 552,000 690,000 215,000 s 475,000 930,000 231,000 Net operating income 699,000 Required: 1. Determine the unit product cost under: a. Absorption costing. b. Variable costing 2. Prepare contribution format variable costing income statements for July and August. 3. Reconcile the variable costing and absorption costing net operating incomes Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Determine the unit product cost under: (a) Absorption costing, (b) Variable costing. Unit Product Cost a. Absorption costing b.Variable costing Required 1 Required 2 Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare contribution format variable costing income statements for July and August. Denton Company Variable Costing Income Statement July August Net operating income (loss) Required 1 Required 3 Required: 1. Determine the unit product cost under: a. Absorption costing b. Variable costing. 2. Prepare contribution format variable costing income statements for July and August. 3. Reconcile the variable costing and absorption costing net operating incomes. Complete this question by entering your answers in the tabs below. Required 2 Required 1 Required 3 Reconcile the variable costing and absorption costing net operating incomes. (Enter any losses or deductions as a negative value.) Reconciliation of Variable Costing and Absorption Costing Net Operating Incomes July August Variable costing net operating income (loss) Add (deduct) fixed manufacturing overhead cost deferred in (released from) inventory under absorption costing Absorption costing net operating income (loss) Required 2 Required 3
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started