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Dahasolnce [82]
3 years ago
11

Absorption and variable costing. (CMA) Miami, Inc., planned and actually manufactured 250,000 units of its single product in 201

7, its first year of operation. Variable manufacturing cost was $19 per unit produced. Variable operating (nonmanufacturing) cost was $13 per unit sold. Planned and actual fixed manufacturing costs were $750,000. Planned and actual fixed operating (nonmanufacturing) costs totaled $420,000. Miami sold 170,000 units of product at $41 per unit.
Required:

1. Miami's 2017 operating income using absorption costing is:

(a) $ 600,000
(b) $ 360,000
(c) $ 780,000
(d) $ 1,020,000
(e) None of above

2. Miami's 2017 operating income using variable costing is:(a) $ 1,100,000(b) $ 600,000(c) $ 360,000(d) $ 780,000(e) None of above
Business
1 answer:
lara31 [8.8K]3 years ago
4 0

Answer:

1.(b) $ 360,000

2. (c) $ 360,000

Explanation:

<u><em>Miami, Inc.</em></u>

<u><em>Absorption Costing</em></u>

<u><em>Income Statement </em></u>

<u><em></em></u>

Sales 170,000 units * $41         $ 6970,000

Variable manufacturing cost  $19 *170,000 units = 3230,000

Actual fixed manufacturing costs $750,000

Contribution Margin  $ 2990,000

Variable operating (non manufacturing) cost  $13  *170,000 units =2210,000

Actual fixed operating (non manufacturing) costs $420,000

Operating Income                                         $ 360,000

<u><em>The difference b/w variable and absorption costing is that in variable costing the variable expenses are treated as product costs and fixed expenses as period costs. But in absorption costing the manufacturing expenses variable and fixed are treated as product costs and selling and administrative expenses  both fixed and variable are treated as period costs.</em></u>

<u><em>Miami, Inc.</em></u>

<u><em>Variable Costing</em></u>

<u><em>Income Statement </em></u>

Sales 170,000 units * $41         $ 6970,000

Variable manufacturing cost  $19 *170,000 units = 3230,000

Variable operating (non manufacturing) cost  $13  *170,000 units =2210,000

Contribution Margin  $1530,000

Actual fixed manufacturing costs $750,000

Actual fixed operating (non manufacturing) costs $420,000

Operating Income                                         $ 360,000

<u><em></em></u>

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skelet666 [1.2K]

The opportunity cost of the third bicycle is 20 tents.

What is opportunity cost?

The value or advantage forfeited by engaging in a specific activity in comparison to engaging in an alternative activity is known as the opportunity cost of that activity. Simply put, it means that if you choose one activity, you forfeit the chance to do another.

Therefore,

The opportunity cost of the third bicycle is 20 tents.

To learn more about opportunity cost from the given link:

brainly.com/question/3611557

4 0
1 year ago
QS 19-10 Computing contribution margin LO P2 D’Souza Company sold 6,000 units of its product at a price of $88.00 per unit. Tota
Nikitich [7]

Answer:

$218,400

Explanation:

The computation of contribution margin is here below:-

                                               Units       Cost per unit         Total

Sales                                     6,000        $88                       $528,000

Less:

Variable production cost     6,000        $40.8                  $244,800

Variable selling and

administrative costs        6,000         $10.8                   $64,800

Contribution margin                                                           $218,400

Therefore the we multiplied the sale unit with cost per unit, in the similar way we multiplied the Variable production cost unit with cost per unit and Variable selling and administrative costs with cost per unit to reach the contribution margin.

4 0
3 years ago
A privately owned summer camp for youngsters has the following data for a 12-week session: Charge per camper Fixed costs Variabl
shtirl [24]

Answer:

Results are below.

Explanation:

Giving the following information:

Fixed costs= $192,000

Unitary variable cost= $320 per week

Selling price per unit= $480 per week

<u>To calculate the total cost, we need to use the following formula:</u>

Total cost= fixed costs + unitary variable cost*number of units

Total cost= 192,000 + 320*number of weeks

<u>Now, the total revenue:</u>

Total revenue= selling price per week*Number of weeks

Total revenue= 480*x

<u>Finally, the break-even point in units:</u>

Break-even point in units= fixed costs/ contribution margin per unit

Break-even point in units= 192,000 / (480 - 320)

Break-even point in units= 1,200 campers

3 0
2 years ago
A 4-year project has an annual operating cash flow of $42,000. At the beginning of the project, $6,000 in net working capital wa
OLEGan [10]

Answer:

Total cash flow $54,613

Explanation:

The computation of the year 4 cash flow is given below:

Selling price of equipment $6,920

Book value at year 4 end $5,460

Capital gain $1,460

Tax on capital gain at 21% $306.6

So,  net cash flow from the sale of equipment  

= $6,920 - $307

= $6,613

Now year 4 cash flow is  

Annual operating cash flow $42,000

Release of working capital  $6,000

Net cash flow form sale of equipment $6,613  

Total cash flow $54,613

3 0
3 years ago
A business’s total revenue for a specified period is $500,000, its operating expenses are $50,000, and its net profit if $150,00
creativ13 [48]

Answer:

your answer is 300,000

8 0
3 years ago
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