On March 31, the end of the first year of operations, Barnard Inc., manufactured 4,300 units and sold 3,700 units. The following income statement was prepared, based on the variable costing concept: Barnard Inc. Variable Costing Income Statement For the Year Ended March 31, 20Y1 Sales $888,000 Variable cost of goods sold: Variable cost of goods manufactured $494,500 Inventory, March 31 (69,000) Total variable cost of goods sold (425,500) Manufacturing margin $462,500 Total variable selling and administrative expenses (107,300) Contribution margin $355,200 Fixed costs: Fixed manufacturing costs $227,900 Fixed selling and administrative expenses 70,300 Total fixed costs (298,200) Operating income $57,000 Determine the unit cost of goods manufactured, based on (a) the variable costing concept and (b) the absorption costing concept. Variable costing $ Absorption costing $

Question

Kody

Business

29 October, 12:34

On March 31, the end of the first year of operations, Barnard Inc., manufactured 4,300 units and sold 3,700 units. The following income statement was prepared, based on the variable costing concept: Barnard Inc. Variable Costing Income Statement For the Year Ended March 31, 20Y1 Sales $888,000 Variable cost of goods sold: Variable cost of goods manufactured $494,500 Inventory, March 31 (69,000) Total variable cost of goods sold (425,500) Manufacturing margin $462,500 Total variable selling and administrative expenses (107,300) Contribution margin $355,200 Fixed costs: Fixed manufacturing costs $227,900 Fixed selling and administrative expenses 70,300 Total fixed costs (298,200) Operating income $57,000 Determine the unit cost of goods manufactured, based on (a) the variable costing concept and (b) the absorption costing concept. Variable costing $ Absorption costing $

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Answers (1)

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Jett Frederick · Answer 1

Cost of Goods Manufactured = $115 per unit

Fixed Manufacturing Overhead = $53 per unit

Absorption product cost per unit = $168

Explanation:

given data

manufactured = 4,300 units

Variable Costing = $494,500

Fixed manufacturing costs = $227,900

solution

so here we get Cost of Goods Manufactured per unit that is

Cost of Goods Manufactured = $494,500 : 4,300

Cost of Goods Manufactured = $115 per unit

and

now we get Fixed Manufacturing Overhead Per Unit will be

Fixed Manufacturing Overhead = $227,900 : 4,300

Fixed Manufacturing Overhead = $53 per unit

and

now we get Variable Product cost Per Unit that is

Variable Product cost = Cost of Goods Manufactured per Unit = $115

so

Absorption product cost per unit = $115 + $53

Absorption product cost per unit = $168