Miller Heating is a small manufacturer of auxiliary heaters. The units sell for $300 each. In 2017,
Question:
Required
Reconcile the difference in profit between the two income statements.
Transcribed Image Text:
Income Statement Prepared Using Variable Costing Miller Heating Company Income Statement For the Year Ending December 31, 2017 Sales $240,000 Less variable costs: Variable cost of goods sold Variable selling expense Contribution margin $32,000 16,000 48,000 192,000 Less fixed costs: Fixed manufacturing expense Fixed selling expense Fixed administrative expense 50,000 20,000 30,000 100,000 $ 92,000 Net income Income Statement Prepared Using Full Costing Miller Heating Company Income Statement For the Year Ending December 31, 2017 Sales $240,000 Less cost of goods sold 72,000 168,000 Gross margin Less selling and administrative expenses: Selling expense Administrative expense $36,000 30,000 66,000 Net income $102,000
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 80% (10 reviews)
Income computed under full costing is 10000 higher than income computed under variable cost...View the full answer
Answered By
HABIBULLAH HABIBULLAH
I have been tutor on chegg for approx 5 months and had solved a lot of questions.
5.00+
1+ Reviews
10+ Question Solved
Related Book For
Question Posted:
Students also viewed these Managerial Accounting questions
-
Miller Heating Company is a small manufacturer of auxiliary heaters. The units sell for $150 each. In 2011, the company produced 1,000 units and sold 800 units. Below are variable and full costing...
-
Miller Heating Company is a small manufacturer of auxiliary heaters. The units sell for $300 each. In 2014, the company produced 1,000 units and sold 800 units. There was no beginning inventory....
-
Sound Sensation Inc. is a small manufacturer of electronic musical instruments. The plant manager received the following variable factory overhead report for the period: The plant manager is not...
-
Interactive promotion allows customers and companies to work together to create mutually beneficial exchange relationships in an ongoing dialogue. True or false
-
When should a debt security be classified as held-to maturity?
-
Which of Smiths statements regarding banks is correct? A . Only Statement 1 B . Only Statement 2 C . Both Statement 1 and Statement 2
-
Air flows in a constant-area, insulated duct. The air enters the duct at \(520{ }^{\circ} \mathrm{R}, 50 \mathrm{psia}\), and \(\mathrm{Ma}=0.45\). At a downstream location, the Mach number is one....
-
Annabelles Uniforms produces uniforms. The company allocates manufacturing overhead based on the machine hours each job uses. Annabelles Uniforms reports the following cost data for the past year:...
-
What are two problems that happens when an organization has tried to change? How successful was the change process?
-
1. How might management of the above supermarkets determine which stores should be closed? 2. How might Asda management determine which stores to open?
-
The following information is available for Dunworth Canoes, a company that builds inexpensive aluminum canoes: In its first year of operation, the company produced 21,000 units but was able to sell...
-
The Octavius Company produces a 10-inch chef knife used by commercial chefs. The knives sell for $50 each. In 2017, the company produced 50,000 units and sold 45,000 units. There was no beginning...
-
For quantitative data, we examined three types of grouping: single-value grouping, limit grouping, and cutpoint grouping. For each type of data given, decide which of these three types is usually...
-
Explain the deterministic safety assessment (DSA) of nuclear reactors and development growth of this methodology over the years.
-
Review the information in Figure 2.4. Choose a rate of trading cherries for apples different from the rate used in the text (15 pounds of cherries for 10 pounds of apples) that will allow you and...
-
The spreadsheet in Table 1 provides data on the U.S. economy: Column A is the year; the other columns are quantities sold in millions per year of compact discs (column B), music videos (column C),...
-
Return to Table 7.12. In the top half of the table, at what point does diminishing marginal productivity kick in? What about in the bottom half of the table? How do you explain this? Table 7.12...
-
In June 2014, the international price of crude oil was about \$114 per barrel (Brent benchmark). Three years later, it was about \(\$ 47\) per barrel. This dramatic price reduction caused petroleum...
-
Many years ago, Topnotch Knives issued a zero coupon bond with a $1,000 face value. The bond matures in three years. If the current market rate on similar bonds is 11 percent, (a) What is the bonds...
-
Making use of the tables of atomic masses, find the velocity with which the products of the reaction B10 (n, ) Li7 come apart; the reaction proceeds via interaction of very slow neutrons with...
-
Erin Hamill is the owner operator of a tanning salon. She is considering four price levels for a weekly tanning pass. Her estimate of price and quantity demanded are: Price Quantity Demanded $12.00...
-
Power Drive, Inc. produces a hard disk drive that sells for $175 per unit. The cost of producing 25,000 drives in the prior year was: Direct material ....... $ 625,000 Direct labor ........ 375,000...
-
Budget Tax Service, Inc prepares tax returns for small businesses. The cost of preparing 800 tax returns in the prior year was: Direct labor ............ $320,000 Variable overhead ..............
-
Oak Creek Furniture Factory (OCFF), a custom furniture manufacturer, uses job order costing to track the cost of each customer order. On March 1, OCFF had two jobs in process with the following...
-
Image transcription text 9:10 X Test_Belgeleme_Vak... Q E .. . Yapisal Test ve Validasyon Takimi Test Belgeleme Muhendisligi Aday Vaka Calismasi Ad: Soyad: 1) Asagidaki sekilde, kok noktasindan...
-
Individual Key Learning Report Individual Key Learning Report A+ Individual Report on Key Learnings Students are required to prepare an individual report at the end of the semester to present the...
Study smarter with the SolutionInn App