A business operated at 100% of capacity during its first month and incurred the following costs: Production costs (2,500 units): Direct materials Direct labor Variable factory overhead Fixed factory overhead $42,500 85,000 47,500 12,500 a. $5,250 Ob. $6,210 Oc. $5,760 Od. $5,625 Operating expenses: Variable operating expenses Fixed operating expenses If 75 units remain unsold at the end of the month, the amount of inventory that would be reported on the absorption costing balance sheet is $187,500 $15,000 4,500 19,500

A business operated at 100% of capacity during its first month and incurred the following costs: Production costs (2,500 units): Direct materials Direct labor Variable factory overhead Fixed factory overhead $42,500 85,000 47,500 12,500 a. $5,250 Ob. $6,210 Oc. $5,760 Od. $5,625 Operating expenses: Variable operating expenses Fixed operating expenses If 75 units remain unsold at the end of the month, the amount of inventory that would be reported on the absorption costing balance sheet is $187,500 $15,000 4,500 19,500

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter7: Variable Costing For Management analysis

Section: Chapter Questions

Problem 4E: On March 31, the end of the first month of operations, Barnard Inc. manufactured 15,000 units and...

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At the end of the first year of operations, 21,500 units remained in the finished goods inventory. The unit manufacturing costs during the year were as follows: Determine the cost of the finished goods inventory reported on the balance sheet under (a) the absorption costing concept and (b) the variable costing concept.
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During the year, a company purchased raw materials of $77,321, and incurred direct labor costs of $125,900. Overhead is applied at the rate of 75% of the direct labor cost. These are the inventory balances: Compute the cost of materials used in production, the cost of goods manufactured, and the cost of goods sold.
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