Exercise 6-12 - Please explain how you arrived at your answers. Thank you! Varia
ID: 2423136 • Letter: E
Question
Exercise 6-12 - Please explain how you arrived at your answers. Thank you!
Variable and Absorption Costing Unit Product Costs and Income Statements [LO1, LO2, LO3]
Fletcher Company manufactures and sells one product. The following information pertains to each of the company’s first two years of operations:
During its first year of operations, Fletcher produced 50,000 units and sold 40,000 units. During its second year of operations, it produced 40,000 units and sold 50,000 units. The selling price of the company’s product is $59 per unit.
a.
Compute the unit product cost for year 1 and year 2.
Year 1 Year 2
Unit Product Cost: _______ __________
Prepare an income statement for year 1 and year 2. (Input all amounts as positive values except losses which should be indicated by a minus sign. Omit the "$" sign in your response.)
Compute the unit product cost for year 1 and year 2. (Round your answers to 2 decimal places. Omit the "$" sign in your response.)
Year 1 Year 2
Unit Product Cost: _______ __________
Prepare an income statement for year 1 and year 2. (Input all amounts as positive values except losses which should be indicated by a minus sign. Omit the "$" sign in your response.)
Reconcile the difference between variable costing and absorption costing net operating income in year 1 and year 2. (Input Income and anything that you add as positive numbers. Input losses and anything that you deduct as negative. Omit the "$" sign in your response.)
Fletcher Company manufactures and sells one product. The following information pertains to each of the company’s first two years of operations:
Explanation / Answer
Answer:1
a. Calculation of the unit Product Cost:
b.
Answer:2
a.
b.
Answer:3
Particulars Year 1 Year 2 Direct Materials 30 30 Direct Labor 13 13 Variable manufacturing overhead 6 6 Unit Product cost 49 49