FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Diego Company manufactures one product that is sold for $73 per unit in two geographic regions-the East and West
regions. The following information pertains to the company's first year of operations in which it produced 44,000 units and
sold 39,000 units.
Variable coats per uniti
Manufacturing:
Direct materials
Direct labor
Variable manufacturing overhead
Variable selling and administrative.
Fixed costs per years
Fixed manufacturing overhead
Fixed selling and administrative expense
Foundational 7-7 (Algo)
$ 23
$16
$2
$4
The company sold 29,000 units in the East region and 10,000 units in the West region. It determined that $180,000 of its
fixed selling and administrative expense is traceable to the West region, $130,000 is traceable to the East region, and the
remaining $90,000 is a common fixed expense. The company will continue to incur the total amount of its fixed
manufacturing overhead costs as long as it continues to produce any amount of its only product.
$748,000
$400,000
7. What is the amount of the difference between the variable costing and absorption costing net operating incomes (losses)?
Variable costing net operating income (loss)
Absorption costing net operating income (loss)
Difference of Variable Costing and Absorption Casting Net Operating Income (Losses)
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Transcribed Image Text:Diego Company manufactures one product that is sold for $73 per unit in two geographic regions-the East and West regions. The following information pertains to the company's first year of operations in which it produced 44,000 units and sold 39,000 units. Variable coats per uniti Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative. Fixed costs per years Fixed manufacturing overhead Fixed selling and administrative expense Foundational 7-7 (Algo) $ 23 $16 $2 $4 The company sold 29,000 units in the East region and 10,000 units in the West region. It determined that $180,000 of its fixed selling and administrative expense is traceable to the West region, $130,000 is traceable to the East region, and the remaining $90,000 is a common fixed expense. The company will continue to incur the total amount of its fixed manufacturing overhead costs as long as it continues to produce any amount of its only product. $748,000 $400,000 7. What is the amount of the difference between the variable costing and absorption costing net operating incomes (losses)? Variable costing net operating income (loss) Absorption costing net operating income (loss) Difference of Variable Costing and Absorption Casting Net Operating Income (Losses)
[The following information applies to the questions displayed below]
Diego Company manufactures one product that is sold for $73 per unit in two geographic regions-the East and West
regions. The following information pertains to the company's first year of operations in which it produced 44,000 units and
sold 39,000 units.
Variable costs per uniti
Manufacturing:
Direct naterials
Direct labor
Variable manufacturing overbead
Variable selling and administrative
Fixed costs per year:
Fixed manufacturing overhead
Fixed selling and administrative expense
$ 23
$16
$2
3.4
$ 748,000
$ 400,000
The company sold 29,000 units in the East region and 10,000 units in the West region. It determined that $180,000 of its
fixed selling and administrative expense is traceable to the West region, $130,000 is traceable to the East region, and the
remaining $90,000 is a common fixed expense. The company will continue to incur the total amount of its fixed
manufacturing overhead costs as long as it continues to produce any amount of its only product.
Foundational 7-10 (Algo)
10. What would have been the company's variable costing net operating income (loss) if it had produced and sold 39,000 units? You do
not need to perform any calculations to answer this question.
expand button
Transcribed Image Text:[The following information applies to the questions displayed below] Diego Company manufactures one product that is sold for $73 per unit in two geographic regions-the East and West regions. The following information pertains to the company's first year of operations in which it produced 44,000 units and sold 39,000 units. Variable costs per uniti Manufacturing: Direct naterials Direct labor Variable manufacturing overbead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expense $ 23 $16 $2 3.4 $ 748,000 $ 400,000 The company sold 29,000 units in the East region and 10,000 units in the West region. It determined that $180,000 of its fixed selling and administrative expense is traceable to the West region, $130,000 is traceable to the East region, and the remaining $90,000 is a common fixed expense. The company will continue to incur the total amount of its fixed manufacturing overhead costs as long as it continues to produce any amount of its only product. Foundational 7-10 (Algo) 10. What would have been the company's variable costing net operating income (loss) if it had produced and sold 39,000 units? You do not need to perform any calculations to answer this question.
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