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20.0%
40.0%
50.0%
3. (TCO C) Heckaman Corporation produces and sells a single product.
Data concerning that product appear below.
Selling price per unit $115.00
Variable expense per unit $56.35
Fixed expense per month $299,115
4. TCO B) Industrial Supply Corporation uses the weighted-average
method in its process costing system. Data concerning the first
processing department for the most recent month are listed below.
Work in process, beginning:
Units in beginning work in process inventory 400
Materials costs $6,900
Conversion costs $2,500
Percent complete for materials 80%
Percent complete for conversion 15%
5. (TCO D) Topple Company produces a single product. Operating
data for the company and its absorption costing income statement for the
last year are presented below.
Units in beginning inventory 0
Units produced 9,000
Units sold 7,000
Sales $100,000
Variable manufacturing costs are $4 per unit. Fixed manufacturing
overhead totals $18,000 for the year. The fixed manufacturing overhead
was applied at a rate of $2 per unit. Variable selling and administrative
expenses were $1 per unit sold.
Required: Prepare a new income statement for the year using variable
costing. Comment on the differences between the absorption costing and
the variable costing income statements. (Points : 30)
6. (TCO I) (Ignore income taxes in this problem.) Simpson Beauty
Products Corporation is considering the production of a new
conditioning shampoo that will require the purchase of new mixing
machinery. The machinery will cost $700,000, is