During Durton Company's first two years of operations, the company reported variable costing operating income as...

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During Durton Company's first two years of operations, the company reported variable costing operating income as shown below. Production a the two years are given: Year 2 25,000 30,000 Year 1 Units produced Units sold 25,000 20,000 Year 2 $1.,500.000 Year 1 $1.000.000 Sales (at $50 per unit) Variable expenses: Variable cost of goods sold (at $20 per unit) Variable selling and administrative costs (at $3 per unit) Total variable expenses Contribution margin Fixed expenses: Fixed manufacturing overhead Fixed selling and administrative Total fixed expenses Operating income (loss) 400,000 60,000 460.000 540.000 600,000 90,000 690.000 810.000 350,000 250.000 600,000 S (60,000) 350,000 250.000 600,000 S 210,000 The company's $20 unit product cost is computed as follows: Direct materials Direct labour Variable manufacturing overhead Unit product cost $ 8 10 $20 Prepare an absorption costing income statement for Year 1. Auto Lavage is a Canadian company that owns and operates a large automatic carwash facility near Quebec. The following table p concerning the company's costs Fixed Cost Cost per Car Washed $0.60 0.20 0.40 0.50 per Month Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses $ 3,100 6,400 10,000 3,800 3.500 0. 05 The company expects to charge customers an average of 57.60 per car washed. a) Prepare a flexible budget for October assuming 11,000 cars are washed. b) Prepare a Flexible Budget Variance and Sales Volume Variance if the Actual Results were: units 11500 Sales 87,900 VC Cleaning Supplies VC Electicity VC Maintenance vC Wages and salaries 7,000 2,500 4,450 5,500 Contribution Margin 68,450 During Durton Company's first two years of operations, the company reported variable costing operating income as shown below. Production a the two years are given: Year 2 25,000 30,000 Year 1 Units produced Units sold 25,000 20,000 Year 2 $1.,500.000 Year 1 $1.000.000 Sales (at $50 per unit) Variable expenses: Variable cost of goods sold (at $20 per unit) Variable selling and administrative costs (at $3 per unit) Total variable expenses Contribution margin Fixed expenses: Fixed manufacturing overhead Fixed selling and administrative Total fixed expenses Operating income (loss) 400,000 60,000 460.000 540.000 600,000 90,000 690.000 810.000 350,000 250.000 600,000 S (60,000) 350,000 250.000 600,000 S 210,000 The company's $20 unit product cost is computed as follows: Direct materials Direct labour Variable manufacturing overhead Unit product cost $ 8 10 $20 Prepare an absorption costing income statement for Year 1. Auto Lavage is a Canadian company that owns and operates a large automatic carwash facility near Quebec. The following table p concerning the company's costs Fixed Cost Cost per Car Washed $0.60 0.20 0.40 0.50 per Month Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses $ 3,100 6,400 10,000 3,800 3.500 0. 05 The company expects to charge customers an average of 57.60 per car washed. a) Prepare a flexible budget for October assuming 11,000 cars are washed. b) Prepare a Flexible Budget Variance and Sales Volume Variance if the Actual Results were: units 11500 Sales 87,900 VC Cleaning Supplies VC Electicity VC Maintenance vC Wages and salaries 7,000 2,500 4,450 5,500 Contribution Margin 68,450

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WORKING NOTES Sales Units sold Selling price Year 1 20000 501000000 Year 2 30000 501500000 In variab... View the full answer