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mars1129 [50]
3 years ago
7

ncome Statements under Absorption Costing and Variable Costing Gallatin County Motors Inc. assembles and sells snowmobile engine

s. The company began operations on July 1 and operated at 100% of capacity during the first month. The following data summarize the results for July: Sales (4,000 units) $2,600,000 Production costs (4,350 units): Direct materials $1,218,000 Direct labor 522,000 Variable factory overhead 87,000 Fixed factory overhead 130,500 1,957,500 Selling and administrative expenses: Variable selling and administrative expenses $60,000 Fixed selling and administrative expenses 25,000 85,000 a. Prepare an income statement according to the absorption costing conce
Business
1 answer:
Mnenie [13.5K]3 years ago
7 0

Answer:

<u>Income statement according to the absorption costing</u>

Sales                                                                                         2,600,000

Less Cost of Goods Sold

Opening Stock                                                          0

Add Cost of Goods Manufactured

Direct materials                                                   1,218,000

Direct labor                                                           522,000

Variable factory overhead                                     87,000

Fixed factory overhead                                        130,500

Less Closing Stock (1,957,500/4,350)×350      (157,500)       1,800,000

Gross Profit                                                                                   800,000

Less Period Costs :

Selling and administrative expenses:

Variable selling and administrative expenses                           (60,000)

Fixed selling and administrative expenses                                (25,000)

Net Income                                                                                    715,000

Explanation:

<em>Product/Manufacturing Cost - Absorption Costing = Direct Materials + Direct Labor + Variable Overheads + Fixed Overheads</em>

<em>Period Cost - Absorption Costing  = All Non - Manufacturing Costs</em>

<u />

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Answer:

Amount for each stock to be paid at maximum = $54

Explanation:

Using Dividend growth model, we have,

P_0 = \frac{D_1}{K_e - g}

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P_0 = \frac{3.24}{0.14-0.08}

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3 years ago
You are considering purchasing a put option on a stock with a current price of $26. The exercise price is $28, and the price of
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3 years ago
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The step in which a salesperson meets the customer for the first time is the __________ step of the creative selling process.
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The step in which a salesperson meets the customer for the first time is the <u>approach step</u> of the creative selling process.

<h3>Who is a saleperson?</h3>

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When a sales person meet a customer for the first time, the sales person need to first approach the customers  before marketing a product to the customer.

Therefore the step in which a salesperson meets the customer for the first time is the <u>approach step.</u>

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2 years ago
The ending inventory of finished goods has a total cost of $11,600 and consists of 600 units. If the overhead applied to these g
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Answer:

the Direct Labor Costs are  $5500

And Direct Materials are 2,250

Explanation:

Finished Goods has a total cost of $11,600

If the overhead applied to these goods is $3,850

Then the Direct Labor Costs are  $5500

And Direct Materials are 2,250

Using the cross product rule

$3850    : 70

x          :   100

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