This Company produces and sells a recycled plastic product that is used for building residential backyard decks.
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Question:
This Company produces and sells a recycled plastic product that is used for building residential backyard decks. The operating costs for the past year were as follows:
Variable costs per unit: | |
Direct Materials | $8.00 |
Direct Labour | $3.20 |
Variable Overhead | $0.70 |
Variable Selling | $0.52 |
Fixed costs per year: | |
Fixed Overhead | $360,000 |
Selling and Administrative | $210,000 |
* Unit fixed cost is based on production
1. During the year, the company produced 600,000 boards and sold 635,000 at $14.50 each. The company had 42,000 boards in beginning finished goods inventory; costs have not changed from last year to this year.
- Assuming the company must adhere to GAAP (Generally Accepted Accounting Principles) what is the cost per unit reported on the Balance Sheet?
- 2. What is the total dollar value in ending finished goods inventory (based on part a above).
- 3. Prepare a variable-costing income statement.
Related Book For
Managerial accounting
ISBN: 978-0471467854
1st edition
Authors: ramji balakrishnan, k. s i varamakrishnan, Geoffrey b. sprin
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