FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Manufacturing Costs
Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.
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Lynch Company manl operations: Variable costs per unit: Manufacturing: Direct materials Direct labor and sells a single pr Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative The following costs were $ $ $ $ 12 7 2 2 $248,000 $158,000 ng the company During the year, the company produced 31,000 units and sold 21,000 units. The selling price of the company's product is $44 per unit. Required: 1. Assume that the company uses absorption costing: a. Compute the unit product cost. b. Prepare an income statement for the year. 2. Assume that the company uses variable costing: a. Compute the unit product cost. b. Prepare an income statement for the year. Complete this question by entering your answers in the tabs below.
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Transcribed Image Text:Lynch Company manl operations: Variable costs per unit: Manufacturing: Direct materials Direct labor and sells a single pr Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative The following costs were $ $ $ $ 12 7 2 2 $248,000 $158,000 ng the company During the year, the company produced 31,000 units and sold 21,000 units. The selling price of the company's product is $44 per unit. Required: 1. Assume that the company uses absorption costing: a. Compute the unit product cost. b. Prepare an income statement for the year. 2. Assume that the company uses variable costing: a. Compute the unit product cost. b. Prepare an income statement for the year. Complete this question by entering your answers in the tabs below.
Complete this question by entering your answers in the tabs below. Req 1A Req 1B Sales Prepare an income statement for the year. Assume that the company uses variable costing Lynch Company Variable Costing Income Statement Variable cost of goods sold Contribution margin Fixed selling and administrative Req 2A Net operating income Req 2B X ✓$ 441,000 X * «* « X X >> 158,000 X $ 924,000 441,000 483,000 158,000 $325,000
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Transcribed Image Text:Complete this question by entering your answers in the tabs below. Req 1A Req 1B Sales Prepare an income statement for the year. Assume that the company uses variable costing Lynch Company Variable Costing Income Statement Variable cost of goods sold Contribution margin Fixed selling and administrative Req 2A Net operating income Req 2B X ✓$ 441,000 X * «* « X X >> 158,000 X $ 924,000 441,000 483,000 158,000 $325,000
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Step 1: Introduction -
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Step 2: Unit Product Cost, Company Uses Absorption Costing -
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Step 3: Income Statement For The Year Uses Absorption Costing -
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Step 4: Working Note -
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Step 5: Unit Product Cost Company Uses Variable Costing -
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Step 6: Income Statement For The Year Uses Variable Costing -
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Step 7: Working Note -
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