View the step-by-step solution to:

Mary's Mugs produces and sells various types of ceramic mugs. The business began operations on January 1, Year 1, and its costs incurred during the...

20.




Mary's Mugs produces and sells various types of ceramic mugs. The business began operations on January 1, Year 1, and its costs incurred during the year include these:


Variable costs (based on mugs produced):
Direct materials cost $ 6,000
Direct manufacturing labor costs 27,000
Indirect manufacturing costs 5,400
Administration and marketing 3,375
Fixed costs:
Administration and marketing costs 18,000
Indirect manufacturing costs 6,000


On December 31, Year 1, direct materials inventory consisted of 3,750 pounds of material. Production in that year was 20,000 mugs. All prices and unit variable costs remained constant during the year. Revenues for year 1 were $73,312. Finished goods inventory was $6,105 on December 31, Year 1. Each finished mug requires 0.4 pounds of material.

Required:
(a)

Direct materials inventory cost, December 31, Year 1. (Round your answer to 2 decimal places. Omit the "$" sign in your response.)

Direct materials inventory $

(b)

Finished goods ending inventory in units on December 31, Year 1.

Finished goods inventory units

(c)

Selling price per unit. (Round your answer to 2 decimal places. Omit the "$" sign in your response.)

Selling price $

(d) Operating profit for year 1. (Omit the "$" sign in your response.)

Operating profit $

This question was asked on Jan 29, 2013.

Recently Asked Questions

Why Join Course Hero?

Course Hero has all the homework and study help you need to succeed! We’ve got course-specific notes, study guides, and practice tests along with expert tutors and customizable flashcards—available anywhere, anytime.

-

Educational Resources
  • -

    Study Documents

    Find the best study resources around, tagged to your specific courses. Share your own to gain free Course Hero access or to earn money with our Marketplace.

    Browse Documents
  • -

    Question & Answers

    Get one-on-one homework help from our expert tutors—available online 24/7. Ask your own questions or browse existing Q&A threads. Satisfaction guaranteed!

    Ask a Question
  • -

    Flashcards

    Browse existing sets or create your own using our digital flashcard system. A simple yet effective studying tool to help you earn the grade that you want!

    Browse Flashcards