Answered step by step
Verified Expert Solution
Question
1 Approved Answer
When Darth Vader isn't busy ridding the galaxy of rebel scum, he enjoys running Vader Collectibles, Inc. Vader Collectibles sells premium-quality model Death Stars. The
When Darth Vader isn't busy ridding the galaxy of rebel scum, he enjoys running Vader Collectibles, Inc. Vader Collectibles sells premium-quality model Death Stars. The Death Stars include miniature lasers with enough power to destroy the four Rebel Trooper action figures that are included with purchase. After making Vader Collectibles, Inc. profitable by using the awesome power of managerial accounting, Darth Vader has decided to apply for a bank loan in order to obtain funds to expand the business. Up until now, Darth Vader has only been using contribution margin income statements and variable costing, but the bank has requested a traditional income statement that uses absorption costing, which is required by Galactic GAAP Information (j^^d for Questions 1-4) on Vader Collectibles, Inc. for the past year is below: For the ended December 31, 2017 g price per unit 90 Units produced Units sold 77,000 13,000 Variable costs per unit S35 $14 58 . Variable manufacturing overhead Variable selling and administrative Fixed costs Fixed manufacturing overhead (to Fixed manufactring Fixed selling and a $455,000 per uni?).--650,00 Darth Vader realizes that none of the pesky rebels have been buying his model Death Stars, so he is missing out on a sizeable amount of customers. In response, he plans to open a new business segment and sell model )X Wings, which should be more attractive to rebel customers. Vader believes that if he adds the X-Wing segment, the following information (used for Questions 5 and 6) will be true: cem Company-wide sales $12,730,000 68% company-wide variable expense ratio.--1,325000 S5,236,000 Death Star segment variable expenses Death Star segment v Death Star traceable fixed expenses X-Wing se ariable e 70% ratio..-- -31,025,000 --989,000 margin Requirements: Using the information presented above, perform the following: 1. Show how the amount of fixed manufacturing overhead per unit is calculated. 2. Calculate product cost per unit using both variable and absorption costing. 3. Calculate the amount of Net Operating Income under absorption costing. 4. Prepare Vader Collectible's absorption costing income statement. 5. Prepare Vader Collectible's segmented income statement. 6. Calculate Vader Collectible's company-wide break-even point in sales dollars
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