Great Outdoze Company manufactures sleeping bags, which sell for $66.30 each. The variable costs of production...

  

Transcribed Image Text:

Great Outdoze Company manufactures sleeping bags, which sell for $66.30 each. The variable costs of production are as follows: Direct material Direct labor Variable manufacturing overhead $18.30 10.00 6.10 Budgeted fixed overhead in 20x1 was $192,000 and budgeted production was 30,000 sleeping bags. The year's actual production was 30,000 units, of which 26,200 were sold. Variable selling and administrative costs were $1.60 per unit sold; fixed selling and administrative costs were $20,000. Required: 1. Calculate the product cost per sleeping bag under (a) absorption costing and (b) variable costing. 2-a. Prepare an operating income statement for the year using absorption costing. 2-b. Prepare an operating income statement for the year using variable costing. 3. Reconcile reported operating income under the two methods using the shortcut method. Req 1 Req 2A Req 2B Selling and Administrative Expenses Req 3 Prepare an operating income statement for the year using absorption costing. (Do not round intermediate calculations.) GREAT OUTDOZE, INC. Operating Income Statement For the Year Ended December 31, 20x1 Absorption Costing < Req 1 Req 2B > Req 1 Variable expenses: Req 2A Fixed expenses: Req 2B Prepare an operating income statement for the year using variable costing. (Do not round intermediate calculations.) GREAT OUTDOZE, INC. Operating Income Statement For the Year Ended December 31, 20x1 Variable Costing Req 3 Req 2A $ $ 0 0 Req 3 > Req 1 Req 2A Req 2B Change in inventory (in units) unit increase Req 3 Reconcile reported operating income under the two methods using the shortcut method. (Round your predetermined fixed overhead rate to 2 decimal places.) Predetermined fixed overhead rate < Req 2B Absorption-costing income minus variable-costing income Req 3 > Great Outdoze Company manufactures sleeping bags, which sell for $66.30 each. The variable costs of production are as follows: Direct material Direct labor Variable manufacturing overhead $18.30 10.00 6.10 Budgeted fixed overhead in 20x1 was $192,000 and budgeted production was 30,000 sleeping bags. The year's actual production was 30,000 units, of which 26,200 were sold. Variable selling and administrative costs were $1.60 per unit sold; fixed selling and administrative costs were $20,000. Required: 1. Calculate the product cost per sleeping bag under (a) absorption costing and (b) variable costing. 2-a. Prepare an operating income statement for the year using absorption costing. 2-b. Prepare an operating income statement for the year using variable costing. 3. Reconcile reported operating income under the two methods using the shortcut method. Req 1 Req 2A Req 2B Selling and Administrative Expenses Req 3 Prepare an operating income statement for the year using absorption costing. (Do not round intermediate calculations.) GREAT OUTDOZE, INC. Operating Income Statement For the Year Ended December 31, 20x1 Absorption Costing < Req 1 Req 2B > Req 1 Variable expenses: Req 2A Fixed expenses: Req 2B Prepare an operating income statement for the year using variable costing. (Do not round intermediate calculations.) GREAT OUTDOZE, INC. Operating Income Statement For the Year Ended December 31, 20x1 Variable Costing Req 3 Req 2A $ $ 0 0 Req 3 > Req 1 Req 2A Req 2B Change in inventory (in units) unit increase Req 3 Reconcile reported operating income under the two methods using the shortcut method. (Round your predetermined fixed overhead rate to 2 decimal places.) Predetermined fixed overhead rate < Req 2B Absorption-costing income minus variable-costing income Req 3 >

Answer rating: 100% (QA)

1 Calculate the product cost per sleeping bag under a absorption costing and b variable costing a Absorption Costing Total Budgeted Fixed Overhead Bud... View the full answer