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3 years ago

Freehan Company’s accounting records has the following information about its inventory:

Business

1 answer:

stealth61 [152]3 years ago

8 0

Answer:

The answer is: $93,150

Explanation:

We can use the following formula to calculate the ending inventory under the average cost method:

ending inventory = average cost per unit x number of units in inventory

First we must determine the average cost per unit:

= [(8,000 x $8) + (17,000 x $10) + (15,000 x $12)] / (8,000 + 17,000 + 15,000)

= ($64,000 + $170,000 + $180,000) / 40,000 units = $414,000 / 40,000

= $10.35 per unit

Then we calculate the value of the ending inventory:

ending inventory = $10.35 per unit x 9,000 units = $93,150

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2 years ago

Exercise 19-9 Income statement under absorption costing and variable costing LO P1, P2 IThe following information applies to the

ivolga24 [154]

Answer:

When you are calculating variable costing, COGS only includes variable costs. All fixed costs are included as period costs at the end. Fixed costs are not carried forward either.

Income Statement (variable costing) - J Cool Sky

total sales $140 x 36,000 units sold = $5,040,000

variable COGS ($3,240,000)

variable direct costs ($60 + $22) x 36,000 = ($2,952,000)

variable overhead ($8 x 36,000) ($288,000)

manufacturing margin $1,800,000

variable administrative and selling costs ($11 x 36,000) = ($396,000)

contribution margin $1,404,000

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fixed overhead = ($528,000)

administrative and selling = ($105,000)

net income $771,000

In order to prepare the income statement using absorption costing, we must first determine COGS = [(total variable manufacturing costs + total fixed manufacturing costs) / total output] x units actually sold

COGS = {[($60 + $22 + $8) x 44,000] + $528,000} / 44,000] x 36,000 = [($3,960,000 + $528,000) / 44,000] x 36,000 = $102 x 36,000 = $3,672,000

Income Statement (absorption costing) - J Cool Sky

total sales $140 x 36,000 units sold = $5,040,000

COGS ($3,672,000)

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fixed administrative and selling costs ($105,000)

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3 years ago

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timama [110]

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4 years ago

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Answer:

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Explanation

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3 years ago

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Aleksandr [31]

Answer:

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