Husseinkhasharmeh drhusseinkhasharmeh

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Unformatted text preview: ee training 180 Factory picnic and holiday party 20 Factory supervisory salaries 1,400 Depreciation, plant and equipment 3,600 Property taxes on plant 300 Insurance on plant 100 $ 6,000 Total indirect manufacturing costs $10,000 Dr. Hussein Khasharmeh Dr. Hussein Khasharmeh Schedule 3: Selling Expenses (in thousands of dollars) Variable: Sales Commission $1,400 Shipping Expenses for products sold 600 $2,000 Fixed: Advertising $1,400 Sales salaries 2,000 Other 600 $4,000 Total Selling Expenses $6,000 Schedule 4: Administrative Expenses Variable: Some clerical wages $160 Computer time rented 40 $200 Fixed: Office supplies 200 Other salaries 400 Depreciation on office facilities 200 Public accounting fees 80 Legal fees 200 Other 720 1,800 Total administrative expenses $ 2,000 Dr. Hussein Khasharmeh Dr. Hussein Khasharmeh Income statement according to Absorption Approach Sales (in thousands of dollars) Less: Manufacturing costs of good sold Direct Materials Direct Labor Indirect Manufacturing (Schedule 1 plus 2) Gross Margin or Gross Profit Selling expenses (Schedule 3) Administrative expenses (Schedule 4) Total selling and administrative expenses Operating income Dr. Hussein Khasharmeh Dr. Hussein Khasharmeh $40,000 $ 14,000 6,000 10,000 30,000 10,000 $ 6,000 2,000 8,000 $2,000 Income statement according to Contribution Approach Cordell Company Contribution Form of the Income Statement For the Year Ended December 31, 2007 (000) Sales (1,000,000 units) Less: Variable expenses Manufacturing $24,000 Selling and administrative 2,200 Contribution margin Less: Fixed expenses Manufacturing $ 6,000 Selling and administrative 5,800 Operating income Dr. Hussein Khasharmeh Dr. Hussein Khasharmeh $40,000 26,200 $13,800 11,800 $ 2,000 Special Sales Orders Example, Cordell Company makes and sells 1,000,000 seat covers. Total manufacturing cost is $30,000,000, or $30 per unit. Cordell is offered a special order of $26 per unit for 100,000 units. Dr. Hussein Khasharmeh Dr. Hussein Kha...
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This document was uploaded on 03/02/2014 for the course ACCOUNTING 221 at Alaska Pacific University.

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