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    ACC 206 WEEK 3 ASSIGNMENT 5

    ACC 206 WEEK 3 Direct and absorption costing 
    The information that follows pertains to Consumer Products for the year ended December 31, 20X6. 
    Inventory, 1/1/X6 	24,000 units 
    Units manufactured 	80,000
    Units sold 	82,000
    Inventory, 12/31/X6 	? units 
    Manufacturing costs: 
    Direct materials 	$3 per unit 
    Direct labor 	$5 per unit 
    Variable factory overhead 	$9 per unit 
    Fixed factory overhead 	$280,000 
    Selling & administrative expenses: 
    Variable 	$2 per unit 
    Fixed 	$136,000 
    
    The unit selling price is $26. Assume that costs have been stable in recent years.
    
    Instructions:
    a.	Compute the number of units in the ending inventory.
    b.	Calculate the cost of a unit assuming use of:
    1.	Direct costing.
    2.	Absorption costing.
    c.	Prepare an income statement for the year ended December 31, 20X6, by using direct costing.
    d.	Prepare an income statement for the year ended December 31, 20X6, by using absorption costing.
    

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  1. ACC 206 WEEK 3 ASSIGNMENT 5ACC 206 WEEK 3 ASSIGNMENT 5ACC 206 WEEK 3 ASSIGNMENT 5ACC 206 WEEK 3 ASSIGNMENT 5ACC 206 WEEK 3 ASSIGNMENT 5
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