The following unit cost would be seen in a (an) _______ costing system.
Direct materials
$ 550
Direct labor
175
Variable manufacturing overhead
70
Fixed manufacturing overhead
125
Unit product cost
$ 920
A. absorption
B. variable
The following unit cost would be seen in a (an) _______ costing system.
| Direct materials | $ 550 |
| Direct labor | 175 |
| Variable manufacturing overhead | 70 |
| Fixed manufacturing overhead | 125 |
| Unit product cost | $ 920 |
| A. | absorption | |
| B. | variable |
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Related questions
Bracey Company manufactures and sells one product. The following information pertains to the companyâs first year of operations:
| Variable cost per unit: | ||
| Direct materials | $ | 23 |
| Fixed costs per year: | ||
| Direct labor | $ | 275,000 |
| Fixed manufacturing overhead | $ | 338,800 |
| Fixed selling and administrative expenses | $ | 56,000 |
The company does not incur any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, Bracey produced 22,000 units and sold 20,700 units. The selling price of the companyâs product is $56 per unit.
Required:
1. Assume the company uses super-variable costing:
a. Compute the unit product cost for the year.
b. Prepare an income statement for the year.
2. Assume the company uses a variable costing system that assigns $12.50 of direct labor cost to each unit produced:
a. Compute the unit product cost for the year.
b. Prepare an income statement for the year.
3. Assume the company uses an absorption costing system that assigns $12.50 of direct labor cost and $15.40 of fixed manufacturing overhead cost to each unit produced:
a. Compute the unit product cost for the year.
b. Prepare an income statement for the year.
4a. Reconcile the difference between the super-variable costing and variable costing net operating incomes.
4b. Reconcile the difference between the super-variable costing and absorption costing net operating incomes.
Bracey Company manufactures and sells one product. The followinginformation pertains to the companyâs first year of operations:
| Variable cost per unit: | ||
| Direct materials | $ | 31 |
| Fixed costs per year: | ||
| Direct labor | $ | 429,000 |
| Fixed manufacturing overhead | $ | 421,200 |
| Fixed selling and administrative expenses | $ | 72,000 |
The company does not incur any variable manufacturing overheadcosts or variable selling and administrative expenses. During itsfirst year of operations, Bracey produced 26,000 units and sold23,900 units. The selling price of the companyâs product is $70 perunit.
Required:
1. Assume the company uses super-variable costing:
a. Compute the unit product cost for the year.
b. Prepare an income statement for the year.
2. Assume the company uses a variable costing system thatassigns $16.50 of direct labor cost to each unit produced:
a. Compute the unit product cost for the year.
b. Prepare an income statement for the year.
3. Assume the company uses an absorption costing system thatassigns $16.50 of direct labor cost and $16.20 of fixedmanufacturing overhead cost to each unit produced:
a. Compute the unit product cost for the year.
b. Prepare an income statement for the year.
4a. Reconcile the difference between the super-variable costingand variable costing net operating incomes.
4b. Reconcile the difference between the super-variable costingand absorption costing net operating incomes.
