My Company produced 26,000 units during February. Direct materials costs are $4.25 per unit and direct labor is $5-75 per unit. Variable overhead is applied at $3.50 per unit and fixed overhead is $78,000 per month. Sales commissions are $0.75 per unit sold. Sales salaries for the month are $65,000 and fixed administrative expenses are $80,000. Required: a. Calculate production cost per unit under variable and absorption costing. b. Prepare an income statement under variable costing and under absorption costing for February assuming all 26,000 units produced were sold for $25 each. c. During March, My Company produced 26,000 units and sold 22,000 units. Prepare an income statement under variable and under absorption costing for March assuming each unit sold for $25 each.

My Company produced 26,000 units during February. Direct materials costs are $4.25 per unit and direct labor is $5-75 per unit. Variable overhead is applied at $3.50 per unit and fixed overhead is $78,000 per month. Sales commissions are $0.75 per unit sold. Sales salaries for the month are $65,000 and fixed administrative expenses are $80,000. Required: a. Calculate production cost per unit under variable and absorption costing. b. Prepare an income statement under variable costing and under absorption costing for February assuming all 26,000 units produced were sold for $25 each. c. During March, My Company produced 26,000 units and sold 22,000 units. Prepare an income statement under variable and under absorption costing for March assuming each unit sold for $25 each.

Name: My Company produced 26,000 units during February. Direct materials co
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Description: My Company produced 26,000 units during February. Direct materials costs are $4.25per unit and direct labor is $5.75 Pper unit. Variable overhead is applied at $3.50 per unitand fixed overhead is $78,000 per month. Sales commissions are $0.75 per un

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter5: Process Costing

Section: Chapter Questions

Problem 1PB: The following product costs are available for Stellis Company on the production of erasers: direct...

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