Question
The following information has been extracted from the financial records of McCain Corporation for its first year of operations in 2021: Units produced 10,000 Units
The following information has been extracted from the financial records of McCain Corporation for its first year of operations in 2021:
| Units produced | 10,000 |
| Units sold | 7,000 |
| Variable costs per unit: | |
| Direct material | $8 |
| Direct labor | 9 |
| Manufacturing overhead | 3 |
| SG&A/unit sold | 4 |
| Fixed costs: | |
| Manufacturing overhead | ($70,000/10,000) = 7 |
| SG&A Beginning inventory units (1/1/21) 0 Ending inventory units (12/31/21) 3,000 | $30,000 |
- Refer to McCain Corporation. What is the total cost of the ending inventory on the balance sheet under direct costing?
- $60,000
- $70,000
- $80,000
- $90,000
2. Refer to McCain Corporation. What is the total cost of the ending inventory on the balance sheet under absorption costing?
- $61,000
- $71,000
- $81,000
- $91,000
3. Refer to McCain Corporation. What is the net income under absorption costing?
| a. | $53,000 |
| b. | $83,000 |
| c. | $93,000 |
| d. | $103,000 |
4 Refer to McCain Corporation. What is the net income under direct costing?
| a. | $102,000 |
| b. | $82,000 |
| c. | $92,000 |
| d. | $72,000 |
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
Financial Accounting Fundamentals
Authors: John Wild
4th Edition
0078025591, 9780078025594
