Question
Vinson Co. manufactures and sells one product. Assume the selling price for each item is $200/per unit. The following information pertains to the companys first
Vinson Co. manufactures and sells one product. Assume the selling price for each item is $200/per unit. The following information pertains to the companys first two years of operation:
Variable Costs Per Unit:
Manufacturing:
Direct Materials $32/unit
Direct Labor $20/unit
Variable Manufacturing Overhead $4/unit
Variable Selling and Administrative $3/unit
Fixed Costs:
Fixed Manufacturing Overhead $660,000
Fixed Selling and Administrative $120,000
Additionally, Vinson Company provides you with the following inventory flow information in terms of units for YEAR 1 & YEAR 2:
YEAR 1 YEAR 2
Beginning Inventory (units) 0 20,000
Units Produced 100,000 75,000
Units Sold 80,000 90,000
Ending Inventory (units) 20,000 5,000
FOR YEAR 1 PLEASE ANSWER THE FOLLOWING QUESTIONS:
Question 1: Using the following table, calculate Vinsons Unit Product Cost/Unit using the Variable Cost Method and Absorption Cost Method.
- Using the Variable Cost Method----Compute Cost Goods Sold:
-Prepare the Companys YEAR 1 Contribution Margin Income Statement---properly label and show all amounts
-Using the Absorption Cost Method----Compute Cost Goods Sold:
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