518 QuizSoln2010

# 518 QuizSoln2010 - increase in variable cost per unit(\$5.50...

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Valenko Company Cost of Goods Manufactured Schedule Beginning Work in Process Inventory \$ 48,000 Beginning Direct Material Inventory \$ 50,000 Direct material Purchased 260,000 Direct Material available 310,000 Ending Direct Material Inventory (40,000) Direct Material Used \$ 270,000 Direct Labor 65,000* Insurance, Factory equipment 8,000 Rent, factory Building 90,000 Utilities, factory 52,000 Cleaning supplies, factory 6,000 Depreciation, factory equipment 110,000 Maintenance, factory 74,000 Manufacturing Overhead 340,000 Total Manufacturing Cost 675,000 Ending Work in Process Inventory (33,000) Cost of Goods Manufactured \$ 690,000 65,000= 675,000-(340,000+270,000) Valenko Company Cost of Goods Sold Schedule

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Beginning Finished Goods Inventory \$ 30,000 Cost of Goods Manufactured 690,000 Cost of goods available for sale \$ 720,000 Ending Finished Goods Inventory 85,000* Cost of goods sold \$ 635,000 85,000=720,000-635,000
1) C 2) C Contribution margin per unit = \$60 - \$22 - \$2* = \$36

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Unformatted text preview: * increase in variable cost per unit (\$5.50 - \$3.50) Break-even point in units = (\$504,000 + \$18,000 + \$288,000) \$36 = 22,500 units 3) B Break-even point (units) = Fixed expenses Contribution margin per unit Substituting: 400 = \$2,000 Contribution margin per unit Contribution margin per unit = \$5 4) C Solve backwards for contribution margin and then variable costs: *Given **At the break-even point, fixed expenses = contribution margin, so we know that fixed costs are \$500,000. Before going any further, it can be seen that variable expense per unit is \$9. 5) C 6) A * Calculate this item by working backwards as shown: Beginning work in process inventory + \$40,000 + \$39,000 + \$20,000 - \$4,000 = \$105,000 Beginning work in process inventory = \$105,000 - \$40,000 - \$39,000 - \$20,000 + \$4,000 = \$10,000...
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## This note was uploaded on 02/11/2012 for the course ACCT 318 taught by Professor Medvil during the Spring '11 term at USC.

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518 QuizSoln2010 - increase in variable cost per unit(\$5.50...

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