Question

Simmons Products has the following cost information available for 2009:
Direct materials ............. $4.00 per unit
Direct labor ................ $3.00 per unit
Variable manufacturing overhead ...... $2.00 per unit
Variable S&A costs ............ $1.00 per unit
Fixed manufacturing overhead ....... $25,000
Fixed S&A costs .............. $10,000
During 2009, Simmons produced 5,000 units, out of which 4,600 units were sold for $30 each.

Required
A. Calculate Simmons’s net income, assuming the company uses variable costing.
B. Calculate Simmons’s net income, assuming the company use absorption costing.



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  • CreatedMarch 11, 2015
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