please type out the answer.The Hampton Company produces and sells a single product. Thefollowing...please...

Free

50.1K

Verified Solution

Question

Accounting

*please type out the answer.
The Hampton Company produces and sells a single product. Thefollowing data refer to the year just completed.
Selling price
$450
Units in beginning inventory
0
Units produced
25,000
Units sold
22,000
Variable costs per unit:
Direct materials
$150
Direct labor
$75
Variable manufacturing overhead
$25
Variable selling and admin
$15
Fixed costs:
Fixed manufacturing overhead
$275,000
Fixed selling and admin
$200,000

Required:
Compute the cost of a single unit of product under both theabsorption costing and variable costing approaches.
Prepare an income statement for the year using absorptioncosting.
Prepare an income statement for the year using variablecosting.

Answer & Explanation Solved by verified expert

3.8 Ratings (561 Votes)

1
Absorption costing:
Direct materials	150
Direct labor	75
Variable manufacturing overhead	25
Fixed manufacturing overhead	11	=275000/25000
Unit product cost	261

Variable costing:
Direct materials	150
Direct labor	75
Variable manufacturing overhead	25
Unit product cost	250

2
Income statement absorption costing:
Sales	9900000	=22000*450
Cost of goods sold	5742000	=22000*261
Gross margin	4158000
Selling and administrative expenses	530000	=200000+(22000*15)
Net operating income	3628000

Income statement variable costing:

Sales		9900000
Variable expenses:
Variable cost of goods sold	5500000
Variable selling and administrative expenses	330000
Total Variable expenses		5830000
Contribution margin		4070000
Fixed expenses:
Fixed manufacturing overhead	275000
Fixed selling and administrative expenses	200000
Total Fixed expenses		475000
Net operatimg income(loss)		3595000

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

Transcribed Image Text

In: Accounting*please type out the answer.The Hampton Company produces and sells a single product. Thefollowing...*please type out the answer.The Hampton Company produces and sells a single product. Thefollowing data refer to the year just completed.Selling price$450Units in beginning inventory0Units produced25,000Units sold22,000Variable costs per unit:Direct materials$150Direct labor$75Variable manufacturing overhead$25Variable selling and admin$15Fixed costs:Fixed manufacturing overhead$275,000Fixed selling and admin$200,000Required:Compute the cost of a single unit of product under both theabsorption costing and variable costing approaches.Prepare an income statement for the year using absorptioncosting.Prepare an income statement for the year using variablecosting.

Selling price	$450

Units in beginning inventory	0
Units produced	25,000
Units sold	22,000

Variable costs per unit:
Direct materials	$150
Direct labor	$75
Variable manufacturing overhead	$25
Variable selling and admin	$15

Fixed costs:
Fixed manufacturing overhead	$275,000
Fixed selling and admin	$200,000

*please type out the answer.The Hampton Company produces and sells a single product. Thefollowing...*please...