Refer to the data in Exercise 69 for CompuDesk. Assume in this exercise that the company uses
Question:
In Exercise 6–9, CompuDesk, Inc., makes an oak desk specially designed for personal computers. The desk sells for $200. Data for last year’s operations follow:
Units in beginning inventory . . . . . . . . . . . . . . . 0
Units produced . . . . . . . . . . . . . . . . . . . . . . . . . 10,000
Units sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,000
Units in ending inventory . . . . . . . . . . . . . . . . . 1,000
Variable costs per unit:
Direct materials . . . . . . . . . . . . . . . . . . . . . . . $ 60
Direct labor . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Variable manufacturing overhead . . . . . . . . . 10
Variable selling and administrative . . . . . . . . 20
Total variable cost per unit . . . . . . . . . . . . . . . $120
Fixed costs:
Fixed manufacturing overhead . . . . . . . . . . . $300,000
Fixed selling and administrative . . . . . . . . . . 450,000
Total fixed costs . . . . . . . . . . . . . . . . . . . . . . . $750,000
Required:
1. Compute the unit product cost for one computer desk.
2. Prepare an income statement.
Ending Inventory
The ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula Ending Inventory Formula =...
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Related Book For
Managerial Accounting
ISBN: 978-0078111006
14th edition
Authors: Ray Garrison, Eric Noreen and Peter Brewer
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