Question

Figure 8-7. Ramon Company reported the following units of production and sales for June and July:...

Figure 8-7.
Ramon Company reported the following units of production and sales for June and July:

Units

Month

Produced

Sold

June

100,000

90,000

July

100,000

105,000

Income under absorption costing for June was $40,000; income under variable costing for July was $50,000. Fixed costs were $600,000 for each month.

7. Refer to Figure 8-7. How much was income for July using absorption costing?

a.

$50,000

b.

$20,000

c.

$80,000

d.

$40,000

8. Refer to Figure 8-7. How much was income for June using variable costing?

a.

$40,000

b.

$20,000

c.

$(40,000)

d.

$(20,000)

Homework Answers

Answer #1

1

Income for July using absorption costing

Fixed cost

600000

Unit of production

100000

Per unit fix cost (fixed cost/normal production)

6

(600000/100000)

Income under variable costing

50000

Less: fix expenses (5000*6)

30000

Income under absorption costing for july

20000

Answer: B. $20000

2

Income for June using variable costing

Per unit fix cost (fixed cost/normal production)

6

(600000/100000)

Income under absorption costing

40000

Absorption costing is higher by (10000*6)

60000

Loss=

20000

Answer : D.$(20000)

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Figure 8-10. Nauman Company has the following information pertaining to its two divisions for last year:...
Figure 8-10. Nauman Company has the following information pertaining to its two divisions for last year: Division X Division Y Variable selling and admin. expenses $ 70,000 $ 90,000 Direct fixed expenses 35,000 100,000 Sales 200,000 400,000 Direct fixed selling and admin. expenses 30,000 70,000 Variable expenses 40,000 100,000 Common expenses are $24,000 for the year. 9. Refer to Figure 8-10. What is the segment margin for Division Y? a. $310,000 b. $210,000 c. $240,000 d. $40,000 10. Refer to...
At Exodus Inc., 40,000 units are produced and 30,000 units are sold for a total of...
At Exodus Inc., 40,000 units are produced and 30,000 units are sold for a total of $720,000 in the first year of operations, resulting in operating income of $240,000. Fixed manufacturing costs are $120,000 and administrative costs are $80,000. Given this, the cost of the ending finished goods inventory under the absorption costing approach is Select one: a. $80,000. b. not able to be determined from the provided information. c. $ 70,000. d. $110,000. e. $90,000. f. $100,000. g. $120,000.
39. Red and White Company reported the following monthly data: Units produced 3,600 units Sales price...
39. Red and White Company reported the following monthly data: Units produced 3,600 units Sales price $ 41 per unit Direct materials $ 7 per unit Direct labor $ 5 per unit Variable overhead $ 8 per unit Fixed overhead $ 9,000 in total What is Red and White's net income under absorption costing if 1,140 units are sold and selling and administrative expenses are $16,200? 40. Red and White Company reported the following monthly data: Units produced 3,600 units...
Figure 6-15 The Davidson Company uses a weighted-average process costing system. The following information was reported...
Figure 6-15 The Davidson Company uses a weighted-average process costing system. The following information was reported for the Assembly Process for January. Materials are added at the beginning of the process and are 100%. Units: units % complete for conversions work in process, 1/1 60,000 15% started 105,000 work in process, 1/31 40,000 20% Costs: beginning work in process $16,500 $33,250 current costs $643,500 $332,500 18. Refer to Figure 6-15. What are the equivalent units for materials? a. 133,000 b....
Production in units 100,000 Sales in units ? Ending finished goods Inventory in units ? Sales...
Production in units 100,000 Sales in units ? Ending finished goods Inventory in units ? Sales in Rupees Rs 2,000,000 Costs : Other selling and administrative expenses Rs 40,000 Other factory overhead costs Rs 22,000 Selling and administrative salaries Rs 240,000 Maintenance Factory Rs 50,000 Utilities factory Rs 60,000 Building Rent (Production Uses 80% of the Space; administrative and sales offices use the rest) Rs 100,000 Royalty paid for use of Production patent, Rs 0.5 per unit produced) ? Rent...
Amos Rubber company manufactures tires. They reported the following information from their operations last period: Cost...
Amos Rubber company manufactures tires. They reported the following information from their operations last period: Cost of Direct Materials used in production: $35,000 Cost of Direct Labor wages: $40,000 Variable Manufacturing Overhead: $30,000 Fixed Manufacturing Overhead: $75,000 Total units produced and sold: 50,000 Under absorption costing, the per-unit cost is greater than the variable per-unit cost by how much? a. $1.50 b. $2.10 c. $2.75 d. $3.10 Wilcher’s construction company reported the following information from their operations last year: Direct...
. Union Company reported the following information about the production and sale of its only product...
. Union Company reported the following information about the production and sale of its only product during the first month of operations: Selling price per unit                                                      $225.00 Sales                                                                                 $315,000 Direct materials used                                                    $160,000 Direct labor                                                                    $100,000 Variable factory overhead                                             $60,000 Fixed factory overhead                                                   $80,000 Variable selling and administrative expenses            $20,000 Fixed selling and administrative expenses                 $30,000 Production volume variance                                                    0 Ending inventory, Direct Materials                                         0 Ending inventory, Work-in-process                                        0 Ending inventory, Finished Goods                           600 units Under absorption costing, what is...
The Manoli Company has collected the following data for use in calculating product costs: Activity Data:...
The Manoli Company has collected the following data for use in calculating product costs: Activity Data: (expected and actual) rug cleaners         sweepers      total units produced                   100,000                  250,000           350,000 prime costs                        $200,000                $584,000           $784,000 direct labor hours    10,000                              40,000                    50,000 machine hours                   20,000                              10,000                      30,000 number of setups    25                                     75                           100 inspection hours                1,600           ...
Trez Company began operations this year. During this first year, the company produced 100,000 units and...
Trez Company began operations this year. During this first year, the company produced 100,000 units and sold 80,000 units. The absorption costing income statement for this year follows. Sales (80,000 units × $45 per unit) $ 3,600,000 Cost of goods sold Beginning inventory $ 0 Cost of goods manufactured (100,000 units × $25 per unit) 2,500,000 Cost of good available for sale 2,500,000 Ending inventory (20,000 × $25) 500,000 Cost of goods sold 2,000,000 Gross margin 1,600,000 Selling and administrative...
Trez Company began operations this year. During this first year, the company produced 100,000 units and...
Trez Company began operations this year. During this first year, the company produced 100,000 units and sold 80,000 units. The absorption costing income statement for this year follows. Sales (80,000 units × $45 per unit) $ 3,600,000 Cost of goods sold Beginning inventory $ 0 Cost of goods manufactured (100,000 units × $25 per unit) 2,500,000 Cost of good available for sale 2,500,000 Ending inventory (20,000 × $25) 500,000 Cost of goods sold 2,000,000 Gross margin 1,600,000 Selling and administrative...