The following information pertains to Chacon Inc. for last year: Beginning inventory in units .........................5,000 Units produced
Question:
The following information pertains to Chacon Inc. for last year:
Beginning inventory in units .........................5,000
Units produced ....................................20,000
Units sold ..........................................23,700
Costs per unit:
Direct materials .....................................$8.00
Direct labor ..........................................$4.00
Variable overhead ..................................$1.50
Fixed overhead* ....................................$4.15
Variable selling expenses ...........................$3.00
Fixed selling and administrative expenses ......$24,300
* Fixed overhead totals $83,000 per year.
Required:
1. Calculate the cost of one unit of product under absorption costing.
2. Calculate the cost of one unit of product under variable costing.
3. How many units are in ending inventory?
4. Calculate the cost of ending inventory under absorption costing.
5. Calculate the cost of ending inventory under variable costing.
Ending InventoryThe ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula Ending Inventory Formula =...
Step by Step Answer:
Cornerstones of Managerial Accounting
ISBN: 978-1305103962
6th edition
Authors: Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger