At the end of November 2016, Caribbean Productions Ltd had 700 units of product BMR400 in store. For the month of December 2016, the company budgeted to produce 10,000 units of the product at a selling price of $2,500 each. Fixed administration and selling expenses were expected to be $1,500,000 and $1,000,000 respectively. During the month, the company produced 10,500 units of the product. On December 31, 2016, there were 1,100 units of the product on hand. The following cost information relating to the product was made available at the end of December 2016: Cost per unit Details $ Direct material 400 Direct labour 500 Variable production overheads 300 1,200 Fixed production overheads 150 Total 1,350 Required: (a) What was the contribution per unit of production for December 2016? (b) How many units of Product BMR400 were sold in December 2016?

At the end of November 2016, Caribbean Productions Ltd had 700 units of product BMR400 in store. For the month of December 2016, the company budgeted to produce 10,000 units of the product at a selling price of $2,500 each. Fixed administration and selling expenses were expected to be $1,500,000 and $1,000,000 respectively. During the month, the company produced 10,500 units of the product. On December 31, 2016, there were 1,100 units of the product on hand. The following cost information relating to the product was made available at the end of December 2016: Cost per unit Details $ Direct material 400 Direct labour 500 Variable production overheads 300 1,200 Fixed production overheads 150 Total 1,350 Required: (a) What was the contribution per unit of production for December 2016? (b) How many units of Product BMR400 were sold in December 2016?

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter7: The Master Budget And Flexible Budgeting

Section: Chapter Questions

Problem 1P: The Sales Department of Minimus Inc. has forecast sales for May 2016 to be 40,000 units. Additional...

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At the end of November 2016, Caribbean Productions Ltd had 700 units of product BMR400 in store. For the month of December 2016, the company budgeted to produce 10,000 units of the product at a selling price of $2,500 each. Fixed administration and selling expenses were expected to be $1,500,000 and $1,000,000 respectively. During the month, the company produced 10,500 units of the product. On December 31, 2016, there were 1,100 units of the product on hand. The following cost information relating to the product was made available at the end of December 2016: Cost per unit Details    $ Direct material 400 Direct labour 500 Variable production overheads 300 1,200 Fixed production overheads 200 Total 1,400 Required: Compare the profit result above using absorption costing techniques.
At the end of November 2016, Caribbean Productions Ltd had 700 units of product BMR400 in store. For the month of December 2016, the company budgeted to produce 10,000 units of the product at a selling price of $2,500 each. Fixed administration and selling expenses were expected to be $1,500,000 and $1,000,000 respectively. During the month, the company produced 10,500 units of the product. On December 31, 2016, there were 1,100 units of the product on hand. The following cost information relating to the product was made available at the end of December 2016: Cost per unit Details    $ Direct material 400 Direct labour 500 Variable production overheads 300 1,200 Fixed production overheads 200 Total 1,400 Required: Calculate the profit for December 2016 using absorption costing techniques.
At the end of November 2016, Caribbean Productions Ltd had 700 units of product BMR400 in store. For the month of December 2016, the company budgeted to produce 10,000 units of the product at a selling price of $2,500 each. Fixed administration and selling expenses were expected to be $1,500,000 and $1,000,000 respectively. During the month, the company produced 10,500 units of the product. On December 31, 2016, there were 1,100 units of the product on hand. The following cost information relating to the product was made available at the end of December 2016: Cost per unit Details    $ Direct material 400 Direct labour 500 Variable production overheads 300 1,200 Fixed production overheads 200 Total 1,400 Required:      Calculate the profit for December 2016 using the marginal costing approach.
At the end of November 2016, Caribbean Productions Ltd had 700 units of product BMR400 in store. For the month of December 2016, the company budgeted to produce 10,000 units of the product at a selling price of $2,500 each. Fixed administration and selling expenses were expected to be $1,500,000 and $1,000,000 respectively. During the month, the company produced 10,500 units of the product. On December 31, 2016, there were 1,100 units of the product on hand. The following cost information relating to the product was made available at the end of December 2016: Cost per unit Details $ Direct material 400 Direct labour 500 Variable production overheads 300 1,200 Fixed production overheads 150 Total 1,350 Required: (c) Calculate the profit for December 2016 using the marginal costing approach. (d)…
At the end of November 2016, Caribbean Productions Ltd had 700 units of product BMR400 in store. For the month of December 2016, the company budgeted to produce 10,000 units of the product at a selling price of $2,500 each. Fixed administration and selling expenses were expected to be $1,500,000 and $1,000,000 respectively. During the month, the company produced 10,500 units of the product. On December 31, 2016, there were 1,100 units of the product on hand. The following cost information relating to the product was made available at the end of December 2016: Cost per unit Details $ Direct material 400 Direct labour 500 Variable production overheads 300 1,200 Fixed production overheads 200 Total 1,400 Required: What was the contribution per unit of production for December 2016? How many units of Product BMR400 were sold in December 2016? Calculate the profit for December 2016 using the marginal costing approach. Compare…
At the end of November 2016, Caribbean Productions Ltd had 700 units of product BMR400 in store. For the month of December 2016, the company budgeted to produce 10,000 units of the product at a selling price of $2,500 each. Fixed administration and selling expenses were expected to be $1,500,000 and $1,000,000 respectively. During the month, the company produced 10,500 units of the product. On December 31, 2016, there were 1,100 units of the product on hand. The following cost information relating to the product was made available at the end of December 2016: Cost per unit Details $ Direct material 400 Direct labour 500 Variable production overheads 300 1,200 Fixed production overheads 150 Total 1,350 Required: (e) Explain to management the circumstance that would have to prevail for both methods to produce the same profit figures. (f) Reconcile the profits…
At the beginning of December 2016, Caribbean Productions Ltd had 700 units of product BMR400 in store. For the month of December 2016, the company budgeted to produce 10,000 units of the product at a selling price of $2,500 each. Fixed production, administration and selling expenses were expected to be $2,000,000, $1,500,000 and $1,000,000 respectively. During the month, the company produced 10,500 units of the product. On December 31, 2016, there were 1,100 units of the product on hand. The following cost information relating to the product was made available at the end of December 2016:    Cost per unit Details    $ Direct material 400 Direct labour 500 Variable production overheads 300 1,200 Fixed production overheads    200 Total 1,400 Required: Calculate the profit for December 2016 using absorption costing approach.    Reconcile the profits obtained from both product costing approaches.
At the beginning of December 2016, Caribbean Productions Ltd had 700 units of product BMR400 in store. For the month of December 2016, the company budgeted to produce 10,000 units of the product at a selling price of $2,500 each. Fixed production, administration and selling expenses were expected to be $2,000,000, $1,500,000 and $1,000,000 respectively. During the month, the company produced 10,500 units of the product. On December 31, 2016, there were 1,100 units of the product on hand. The following cost information relating to the product was made available at the end of December 2016:    Cost per unit Details    $ Direct material 400 Direct labour 500 Variable production overheads 300 1,200 Fixed production overheads    200 Total 1,400 Required: (a)   What was the contribution per unit of production for December 2016?    (b)   How many units of Product BMR400 were sold in December 2016?…
At the end of March 2021, there were 700 units of a product manufactured by D & Y Manufacturing. The company has a budgeted capacity of 9,000 units and during the month, one unit of the product was sold for $800. Production and sales for the month amounted to 4,800 units and 8,500 units respectively. Administrative, selling and production overheads were estimated at $200,000, $275,000 and $540,000 respectively. The following information relating to the product was also extracted from the financial records: Cost per unit Details $ Direct materials 300 Direct labour 200 Variable overheads 100   Total 600 Required: (a)   Determine the amount of stock in store at the start of the month.   (b)  Calculate the full cost per unit of production for March 2021.           (c)   Prepare profit statement for the month using Marginal Costing.
At the end of March 2021, there were 700 units of a product manufactured by D & Y Manufacturing. The company has a budgeted capacity of 9,000 units and during the month, one unit of the product was sold for $800. Production and sales for the month amounted to 4,800 units and 8,500 units respectively. Administrative, selling and production overheads were estimated at $200,000, $275,000 and $540,000 respectively. The following information relating to the product was also extracted from the financial records: Cost per unit Details $ Direct materials 300 Direct labour 200 Variable overheads 100   Total 600 Required: (a)   Determine the amount of stock in store at the start of the month. (b)  Calculate the full cost per unit of production for March 2021.
At the end of March 2021, there were 700 units of a product manufactured by D & Y Manufacturing. The company has a budgeted capacity of 9,000 units and during the month, one unit of the product was sold for $800. Production and sales for the month amounted to 4,800 units and 8,500 units respectively. Administrative, selling and production overheads were estimated at $200,000, $275,000 and $540,000 respectively. The following information relating to the product was also extracted from the financial records: Cost per unit Details $ Direct materials 300 Direct labour 200 Variable overheads 100   Total 600 Required: (c)   Prepare profit statement for the month using Marginal Costing.      (d)  Prepare profit statement for the month using Absorption Costing.
At the end of March 2021, there were 700 units of a product manufactured by D & Y Manufacturing. The company has a budgeted capacity of 9,000 units and during the month, one unit of the product was sold for $800. Production and sales for the month amounted to 4,800 units and 8,500 units respectively. Administrative, selling and production overheads were estimated at $200,000, $275,000 and $540,000 respectively. The following information relating to the product was also extracted from the financial records: Cost per unit Details $ Direct materials 300 Direct labour 200 Variable overheads 100   Total 600 Required: (a)   Determine the amount of stock in store at the start of the month.   (b)  Calculate the full cost per unit of production for March 2021.           (c)   Prepare profit statement for the month using Marginal Costing. (d)  Prepare profit statement for the month using Absorption Costing.    (e)   Prepare a reconciliation of the profits…