During Heaton Company's first two years of operations, it reported absorption costing net operating income as...
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During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows: Sales ( 563 per unit) Cost of goods sold ( $34 per unit) Gross margin Selling and administrative expenses Net operating income Year 1 $ 1,071,000 578,000 493,000 304,000 189,000 $ *$3 per unit variable: $253,000 fixed each year. The company's $34 unit product cost is computed as follows: Direct materials Direct labor Variable manufacturing overhead $ Fixed manufacturing overhead ($286,000 22,000 units) Absorption costing unit product cost Units produced Units sold Production and cost data for the first two years of operations are: Year 1 Year 2 22,000 22,000 17,000 27,000 Year 2 $ 1,701,000 918,000 783,000 334,000 449,000 $ $34 s Production and cost data for the first two years of operations are: Year 1 Year 2 22,000 22,000 17,000 27,000 Units produced Units sold Required: 1. Using variable costing, what is the unit product cost for both years? 2. What is the variable costing net operating income in Year 1 and in Year 2? 3. Reconcile the absorption costing and the variable costing net operating income figures for each year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Reconcile the absorption costing and the variable costing net operating income figures for each year. Reconciliation of Variable Costing and Absorption Costing Net Operating Incomes Year 1 Variable costing net operating income (loss) absorption costing Year 2 During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows: Sales ( 563 per unit) Cost of goods sold ( $34 per unit) Gross margin Selling and administrative expenses Net operating income Year 1 $ 1,071,000 578,000 493,000 304,000 189,000 $ *$3 per unit variable: $253,000 fixed each year. The company's $34 unit product cost is computed as follows: Direct materials Direct labor Variable manufacturing overhead $ Fixed manufacturing overhead ($286,000 22,000 units) Absorption costing unit product cost Units produced Units sold Production and cost data for the first two years of operations are: Year 1 Year 2 22,000 22,000 17,000 27,000 Year 2 $ 1,701,000 918,000 783,000 334,000 449,000 $ $34 s Production and cost data for the first two years of operations are: Year 1 Year 2 22,000 22,000 17,000 27,000 Units produced Units sold Required: 1. Using variable costing, what is the unit product cost for both years? 2. What is the variable costing net operating income in Year 1 and in Year 2? 3. Reconcile the absorption costing and the variable costing net operating income figures for each year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Reconcile the absorption costing and the variable costing net operating income figures for each year. Reconciliation of Variable Costing and Absorption Costing Net Operating Incomes Year 1 Variable costing net operating income (loss) absorption costing Year 2
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Related Book For
Managerial Accounting
ISBN: 978-0697789938
13th Edition
Authors: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer
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