Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. denton company manufactures and sells a single pro

Denton Company manufactures and sells a single product. Cost data for the product are given: Variable costs...

90.2K

Verified Solution

Question

Accounting

Denton Company manufactures and sells a single product. Costdata for the product are given:

Variable costs per unit:
Direct materials$4
Direct labor10
Variable manufacturing overhead3
Variable selling and administrative2
Total variable cost per unit$19
Fixed costs per month:
Fixed manufacturing overhead$60,000
Fixed selling and administrative166,000
Total fixed cost per month$226,000

The product sells for $53 per unit. Production and sales datafor July and August, the first two months of operations,follow:

Units
Produced		Units
Sold
July15,00011,000
August15,00019,000

The company’s Accounting Department has prepared the followingabsorption costing income statements for July and August:

JulyAugust
Sales$583,000$1,007,000
Cost of goods sold231,000399,000
Gross margin352,000608,000
Selling and administrative expenses188,000204,000
Net operating income$164,000$404,000

Required:

1. Determine the unit product cost under:

a. Absorption costing.

b. Variable costing.

2. Prepare variable costing income statements for July andAugust.

3. Reconcile the variable costing and absorption costing netoperating incomes.

Answer & Explanation Solved by verified expert
4.0 Ratings (696 Votes)
    See Answer
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Basic Math
1.2K views

noto Pro Ph reported the following figures on its December 31 2024 income statement and...

Accounting
1.2K views

what is meant by the term “Management by exception”? If employees are chronically unable to meet...

Operations Management
1.2K views

SMall Batch Production - Organizational theory.

Advance Math
1.2K views

At the beginning of each football season, the coaching staff at Vista High School must vote...

Basic Math
1.2K views

3.3) A small market orders copies of a certain magazine for its magazine rack each week....

Biology
1.2K views

How did Jim Crow Laws affect African Americans voting rights O These laws ensured black...

Basic Math
1.2K views

Simplify 6r 2 5 Enter your answer as an expression in terms of r Use...

Basic Math
1.2K views

A group of scientists is studying Streptococcus lactis, which is used in the production of...

Calculus
1.2K views

In a recent year, companies spent a total of $87.6 billion on newspaper, television, and...

Algebra
1.2K views

3 A parking meter charges 2 50 per hour How much would it cost to...

Accounting
1.2K views

All sales are on credit. Recent experience shows that 20% of credit sales is collected...

Finance
1.2K views

Parramore Corp has $16 million of sales, $3 million of inventories, $2 million of receivables,...