Introduction To Managerial Accounting
8th Edition
ISBN: 9781259917066
Author: BREWER, Peter C., Garrison, Ray H., Noreen, Eric W.
Publisher: Mcgraw-hill Education,
expand_more
expand_more
format_list_bulleted
Videos
Textbook Question
Chapter 7, Problem 7F15
Diego Company manufactures one product that is sold for $80 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 40:000 units and sold 35,000 units
The company sold 25,000 units in the East region and 10,000 units in the Vest region. It determined that $250,000 of its fixed selling andadministrative expense is traceable to the Vest region, $150,000 is traceable to the East region; and the remaining $96,000 is a common fixed expense. The company will continue to incur the total amount of its fixed
Required:
Answer each question independently based on the original data unless instructed otherwise. You do not need to prepare a segmented income statement until question 13.
What is the amount of the difference between the variable costing and absorption costing net operating incomes? What is the cause of this difference?
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Harris Company manufactures and sells a single product. A partially completed schedule of the company's total costs and costs per
unit over the relevant range of 57,000 to 97,000 units is given below:
Required:
1. Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below.
2. Assume that the company produces and sells 87,000 units during the year at a selling price of $7.69 per unit. Prepare a contribution
format income statement for the year.
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. (Round the per unit
variable cost and fixed cost to 2 decimal places.)
Total cost:
Variable cost
Fixed cost
Total cost
Cost per unit:
Variable cost
Fixed cost
Total cost per unit
$
$
57,000
Units Produced and Sold
77,000
136,800
330,000
466,800
Harris Company manufactures and sells a single product. A partially completed schedule of the company's total costs and costs per
unit over the relevant range of 66,000 to 106,000 units is given below:
Required:
1. Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below.
2. Assume that the company produces and sells 96,000 units during the year at a selling price of $8.65 per unit. Prepare a
contribution format Income statement for the year.
Complete this question by entering your answers in the tabs below.
Required 1
Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. (Round the per unit
variable cost and fixed cost to 2 decimal places.)
Total cost:
Variable cost
Fixed cost
Total cost
Cost per unit:
Variable cost
Required 2
Fixed cost
Total cost per unit
S
S
S
66,000
Units Produced and Sold
198,000
400,000
598,000 S
0.00
S
86,000
10 S
0.00 S
106,000
0.00
2
Harris Company manufactures and sells a single product. A partially completed schedule of the company's total costs and costs per
unit over the relevant range of 64,000 to 104,000 units is given below:
Required:
1. Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below.
2. Assume that the company produces and sells 94,000 units during the year at a selling price of $8.62 per unit. Prepare a
contribution format income statement for the year.
Answer is complete but not entirely correct.
Complete this question by entering your answers in the tabs below.
Required 1
Required 2
Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. (Round the per unit
variable cost and fixed cost to 2 decimal places.)
Units Produced and Sold
64,000
84,000
104,000
Total costs:
Variable costs
$
198,400
260,400 V
322,400 O
Fixed costs
380,000
630,000 X
780,000 X
Total costs
2$
578,400
$
890,400
$ 1,102,400
Cost…
Chapter 7 Solutions
Introduction To Managerial Accounting
Ch. 7 - What is the difference between absorption costing...Ch. 7 - Are selling and administrative expenses treated as...Ch. 7 - Explain how fixed manufacturing overhead costs are...Ch. 7 - What are the arguments in favor of treating fixed...Ch. 7 - What are the arguments in favor of treating fixed...Ch. 7 - Prob. 6QCh. 7 - If the units produced exceed the units sold, which...Ch. 7 - Prob. 8QCh. 7 - Prob. 9QCh. 7 - How does Lean Production reduce or eliminate the...
Ch. 7 - Prob. 11QCh. 7 - Prob. 12QCh. 7 - Distinguish between a traceable fixed cost and a...Ch. 7 - Explain how the contribution margin differs from...Ch. 7 - Why aren’t common fixed costs allocated to...Ch. 7 - How is it possible for a fixed cost that ¡s...Ch. 7 - Should a company allocate its common fixed costs...Ch. 7 - Prob. 1AECh. 7 - Prob. 2AECh. 7 - Prob. 3AECh. 7 - Diego Company manufactures one product that is...Ch. 7 - Prob. 2F15Ch. 7 - Prob. 3F15Ch. 7 - Prob. 4F15Ch. 7 - Diego Company manufactures one product that is...Ch. 7 - Prob. 6F15Ch. 7 - Diego Company manufactures one product that is...Ch. 7 - Prob. 8F15Ch. 7 - Diego Company manufactures one product that is...Ch. 7 - Prob. 10F15Ch. 7 - Prob. 11F15Ch. 7 - Prob. 12F15Ch. 7 - Prob. 13F15Ch. 7 - Diego Company manufactures one product that is...Ch. 7 - Diego Company manufactures one product that is...Ch. 7 - Prob. 1ECh. 7 - Variable Costing Income Statement; Explanation of...Ch. 7 - Reconciliation of Absorption and Variable Costing...Ch. 7 - Prob. 4ECh. 7 - Prob. 5ECh. 7 - Prob. 6ECh. 7 - Prob. 7ECh. 7 - Deducing Changes ¡n Inventories LO7—3 Parker...Ch. 7 - Variable and Absorption Costing Unit Product Costs...Ch. 7 - Prob. 10ECh. 7 - Segmented Income Statement L07—4 Wingate Company,...Ch. 7 - Prob. 12ECh. 7 - Prob. 13ECh. 7 - Variable Costing Unit Product Cost and Income...Ch. 7 - Absorption Costing Unit Product Cost and Income...Ch. 7 - Working with a Segmented Income Statement;...Ch. 7 - Prob. 17ECh. 7 - Prob. 18PCh. 7 - Variable Costing Income Statement; Reconciliation...Ch. 7 - Variable and Absorption Costing Unit Product Costs...Ch. 7 - Segment Reporting and Decision-Making L07—4 Vulcan...Ch. 7 - Prob. 22PCh. 7 - Absorption and Variable Costing; Production...Ch. 7 - Companywide and Segment Break-Even Analysis;...Ch. 7 - Prepare and Interpret Income Statements; Changes...Ch. 7 - Prob. 26PCh. 7 - Variable and Absorption Costing Unit Product Costs...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Harris Company manufactures and sells a single product. A partially completed schedule of the company's total costs and costs per unit over the relevant range of 56,000 to 96,000 units is given below: Required: 1. Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. 2. Assume that the company produces and sells 86,000 units during the year at a selling price of $8.73 per unit. Prepare a contribution format income statement for the year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. (Round the per unit variable cost and fixed cost to 2 decimal places.) 56,000 Units Produced and Sold 76,000 Units Produced and Sold 96,000 Units Produced and Sold Total costs: $ $ 0 $ Variable costs Fixed costs Total costs Cost per unit: Variable cost Fixed cost Total cost per unit 123,200 420,000 543,200 $…arrow_forwardHarris Company manufactures and sells a single product. A partially completed schedule of the company's total costs and costs per unit over the relevant range of 55,000 to 95,000 units is given below: Required: 1. Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. 2. Assume that the company produces and sells 85,000 units during the year at a selling price of $7.40 per unit. Prepare a contribution format income statement for the year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. (Round the per variable cost and fixed cost to 2 decimal places.) Total cost: Variable cost Fixed cost Total cost Cost per unit: Variable cost Fixed cost Total cost per unit 55,000 Units Produced and Sold $ $ 132,000 300,000 432,000 75,000 Units Produced and Sold 95,000 Units Produced and Soldarrow_forwardHarris Company manufactures and sells a single product. A partially completed schedule of the company's total costs and costs per unit over the relevant range of 63,000 to 103,000 units is given below: Required: 1. Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. 2. Assume that the company produces and sells 93,000 units during the year at a selling price of $9.14 per unit. Prepare a contribution format income statement for the year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. (Round the per unit variable cost and fixed cost to 2 decimal places.) Total costs: Variable costs Fixed costs Total costs Cost per unit: Variable cost Fixed cost Total cost per unit 63,000 Units Produced and Sold $ $ $ 83,000 Units Produced and Sold 163,800 460,000 623,800 $ 0.00 $ 103,000 Units Produced and…arrow_forward
- Harris Company manufactures and sells a single product. A partially completed schedule of the company's total costs and costs per unit over the relevant range of 55,000 to 95,000 units is given below: Required: 1. Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. 2. Assume that the company produces and sells 85,000 units during the year at a selling price of $8.67 per unit. Prepare a contribution format income statement for the year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. (Round the per unit variable cost and fixed cost to 2 decimal places.) Total cost: Variable cost Fixed cost Total cost Cost per unit: Variable cost Fixed cost Total cost per unit $ $ 55,000 Units Produced and Sold 75,000 187,000 320,000 507,000 95,000arrow_forwardHarris Company manufactures and sells a single product. A partially completed schedule of the company's total costs and costs per unit over the relevant range of 55,000 to 95,000 units is given below: Required: 1. Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. 2. Assume that the company produces and sells 85,000 units during the year at a selling price of $8.90 per unit. Prepare a contribution format income statement for the year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. (Round the per unit variable cost and fixed cost to 2 decimal places.) Total cost: Variable cost Fixed cost Total cost Cost per unit: Variable cost Fixed cost Total cost per unit 55,000 Units Produced and Sold $ $ $ 75,000 Units Produced and Sold 192,500 330,000 522,500 $ 0.00 $ 95,000 Units Produced and Sold…arrow_forwardHarris Company manufactures and sells a single product. A partially completed schedule of the company's total costs and costs per unit over the relevant range of 62,000 to 102,000 units is given below: Required: 1. Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. 2. Assume that the company produces and sells 92,000 units during the year at a selling price of $10.34 per unit. Prepare a contribution format income statement for the year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. (Round the per unit variable cost and fixed cost to 2 decimal places.) Total costs: Variable cost Fixed cost Total costs Cost per unit: Variable cost Fixed cost Total cost per unit + $ $ $ Units Produced and Sold 62,000 82,000 254,200 430,000 684,200 $ 4.10 6.94 11.04 $ 0 0.00 $ $ 102,000 0 0.00arrow_forward
- O’Brien Company manufactures and sells one product. The following information pertains to each of the company’s first three years of operations: During its first year of operations, O’Brien produced 100,000 units and sold 80,000 units. During its second year of operations, it produced 75,000 units and sold 90,000 units. In its third year, O’Brien produced 80,000 units and sold 75,000 units. The selling price of the company’s product is $75 per unit. Required: Assume the company uses absorption costing and a FIFO inventory flow assumption (FIFO means first-in first-out. In other words, it assumes that the oldest units in inventory are sold first): Compute the unit product cost for Year 1, Year 2, and Year 3. Prepare an income statement for Year 1, Year 2, and Year 3. Assume the company uses absorption costing and a LIFO inventory flow assumption (LIFO means last-in, first-out. In other words, it assumes that the newest units in inventory are sold first): Compute the unit…arrow_forwardHarris Company manufactures and sells a single product. A partially completed schedule of the company's total costs and costs per unit over the relevant range of 52,000 to 92,000 units is given below: Required: 1. Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. 2. Assume that the company produces and sells 82,000 units during the year at a selling price of $11.11 per unit. Prepare a contribution format Income statement for the year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. (Round the per unit variable cost and fixed cost to 2 decimal places.) Total cost: Variable cost Fixed cost Total cost Cost per unit: Variable cost Fixed cost Total cost per unit 52,000 Units Produced and Sold $ $ 208,000 440,000 648,000 72,000 Units Produced and Soldarrow_forwardHarris Company manufactures and sells a single product. A partially completed schedule of the company’s total costs and costs per unit over the relevant range of 59,000 to 99,000 units is given below: Required: 1. Complete the schedule of the company’s total costs and costs per unit as given in the relevant tab below. 2. Assume that the company produces and sells 89,000 units during the year at a selling price of $11.10 per unit. Prepare a contribution format income statement for the year. Units Produced and Sold 59,000 79,000 99,000 Total costs: Variable cost $230,100 not attempted not attempted Fixed cost 490,000 not attempted not attempted Total costs $720,100 $0 $0 Cost per unit: Variable cost not attempted not attempted not attempted Fixed cost not attempted not attempted not attempted Total cost per unit $0.00 $0.00 $0.00 Harris Company Contribution Format Income Statement Salesselected answer correct…arrow_forward
- Harris Company manufactures and sells a single product. A partially completed schedule of the company's total costs and costs per unit over the relevant range of 68,000 to 108,000 units is given below: Required: 1. Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. 2. Assume that the company produces and sells 98,000 units during the year at a selling price of $8.42 per unit. Prepare a contribution format income statement for the year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. Note: Round the per unit variable cost and fixed cost to 2 decimal places. Total cost: Variable cost Fixed cost Total cost Cost per unit: Variable cost Fixed cost Total cost per unit $ $ $ 68,000 Units Produced and Sold 88,000 210,800 380,000 590,800 0.00 $ $ 0 0.00 $ $ 108,000 0 0.00arrow_forwardHarris Company manufactures and sells a single product. A partially completed schedule of the company's total costs and costs per unit over the relevant range of 68,000 to 108,000 units is given below: Required: 1. Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. 2. Assume that the company produces and sells 98,000 units during the year at a selling price of $8.42 per unit. Prepare a contribution format income statement for the year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Complete the schedule of the company's total costs and costs per unit as given in the relevant tab below. Note: Round the per unit variable cost and fixed cost to 2 decimal places. Total cost: Variable cost Fixed cost Total cost Cost per unit: Variable cost Fixed cost Total cost per unit $ $ $ 68,000 Units Produced and Sold 88,000 210,800 380,000 590,800 $ 3.10 5.59 8.69 $ 272,800 380,000 652,800 $ 3.10 4.32 7.42…arrow_forwardHarris Company manufactures and sells a single product. A partially completed schedule of the company’s total costs and costs per unit over the relevant range of 68,000 to 108,000 units is given below: Required: 1. Complete the schedule of the company’s total costs and costs per unit as given in the relevant tab below. 2. Assume that the company produces and sells 98,000 units during the year at a selling price of $9.34 per unit. Prepare a contribution format income statement for the year. Complete this question by entering your answers in the tabs below. Required 1 Complete the schedule of the company’s total costs and costs per unit as given in the relevant tab below. (Round the per unit variable cost and fixed cost to 2 decimal places.) 68,000 Units Produced and Sold 88,000 Units Produced and Sold 108,000 Units Produced and Sold Total cost: Variable cost $204,000 Fixed cost 470,000 Total cost $674,000…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,
Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSON
Intermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill Education
Financial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education
Job Costing and Spoilage | Topic 2 | Spoilage, Re-work, and Scrap; Author: Samantha Taylor;https://www.youtube.com/watch?v=VP55_W2oXic;License: CC-BY