Chapter 2 to 5.docx - A partial listing of costs incurred...

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A partial listing of costs incurred during December at Rooks Corporation appears below: Factory supplies $ 27,000 Administrative wages and salaries $ 124,000 Direct materials $ 172,000 Sales staff salaries $ 87,000 Factory depreciation $ 68,000 Corporate headquarters building rent $ 53,000 Indirect labor $ 51,000 Marketing $ 122,000 A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations: Selling price $ 137 Units in beginning inventory 0 Units produced 2,850 Units sold 2,700 Units in ending inventory 150 Variable cost per unit: Direct materials $ 44 Direct labor $ 21 Variable manufacturing overhead $ 12 Variable selling and administrative $ 17 Fixed costs: Fixed manufacturing overhead $ 91,200 Fixed selling and administrative expenses $ 10,800 The total gross margin for the month under absorption costing is: $75,600 $18,900 $105,300 $116,100 Unit product cost under absorption costing: Direct materials $44 Direct labor 21 Variable manufacturing overhead 12 Fixed manufacturing overhead cost ($91,200/2,850 units produced) 32 Absorption costing unit product cost $109 Absorption costing income statement: Sales (2,700 units sold × $137 per unit) $369,900 Cost of goods sold (2,700 units sold × $109 per unit) 294,300 Gross margin $75,600
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Direct labor $ 102,000 The total of the period costs listed above for December is: $146,000 $386,000 $420,000 $475,000 A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations: Selling price $ 137 Units in beginning inventory 0 Units produced 2,850 Units sold 2,700 Units in ending inventory 150 Variable cost per unit: Direct materials $ 44 Direct labor $ 21 Variable manufacturing overhead $ 12 Variable selling and administrative $ 17 Fixed costs: Fixed manufacturing overhead $ 91,200 Fixed selling and administrative expenses $ 10,800 The total gross margin for the month under absorption costing is: $75,600 $18,900 $105,300 $116,100 Unit product cost under absorption costing: Direct materials $44 Direct labor 21 Variable manufacturing overhead 12 Fixed manufacturing overhead cost ($91,200/2,850 units produced) 32 Absorption costing unit product cost $109 Absorption costing income statement: Sales (2,700 units sold × $137 per unit) $369,900 Cost of goods sold (2,700 units sold × $109 per unit) 294,300 Gross margin $75,600
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Period costs include administrative wages and salaries, sales staff salaries, corporate headquarters building rent, and marketing. $124,000 + $87,000 + $53,000 + $122,000= $386,000 Calip Corporation, a merchandising company, reported the following results for October: Sales $432,800 Cost of goods sold (all variable) $184,100 A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations: Selling price $ 137 Units in beginning inventory 0 Units produced 2,850 Units sold 2,700 Units in ending inventory 150 Variable cost per unit: Direct materials $ 44 Direct labor $ 21 Variable manufacturing overhead $ 12 Variable selling and administrative $ 17 Fixed costs: Fixed manufacturing overhead $ 91,200 Fixed selling and administrative expenses $ 10,800 The total gross margin for the month under absorption costing is: $75,600 $18,900 $105,300 $116,100 Unit product cost under absorption costing: Direct materials $44 Direct labor 21 Variable manufacturing overhead 12
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