Company X produced 3000 units and presents the following information:

Manufacturing costs

• Variable cost: $150 /unit
• Fixed cost: $183 /unit

Inventory data

• Beginning inventory: 1200 units

• Ending inventory: 2200 units

If Company X uses an absorption costing system, what is the amount of fixed manufacturing costs expensed in the Income statement assuming no variances?

Company X manufactures a single product. For each unit, $2891 of direct material is used and there is $2000 of direct manufacturing labor at $20 per hour. Manufacturing overhead is applied at $22 per direct manufacturing labor hour.

Calculate the profit earned on 50 units if each unit sells for $9000.

Company X presents the following information:

• Beginning inventory of Finished goods: $120000
• Ending inventory of Finished goods: $60000
• Beginning inventory of Work in progress: $150000
• Ending inventory of Work in progress: $90000
• Direct materials used in production: $30000
• Direct Labor and overhead costs: $180000

Based on the information above, determine the cost of goods sold (COGS) for the period.

The following information is available for Company

X:

• Revenue

  = $400000

• Selling

  price = $40/unit

• Fixed costs = $200000

• Operating

  income before taxes = $100000

How much is the net income after taxes if the

company sells 20000 units, assuming an income tax rate of 21% ?

Company X manufactures and sells a single product. The following data is available for Year 1:

• Total revenue: $5000000
• Cost of merchandise: 25% of revenue
• Sales commissions: 5% of revenue
• Marketing variable expenses: 10% of revenue
• Annual fixed selling expenses $762836
• Annual fixed administrative expenses $1804539

The company’s margin of safety in terms of revenues is:

Company X manufactures and sells a single product. The following data is available for Year 1:

• Total revenue: $5000000
• Cost of merchandise: 25% of revenue
• Sales commissions: 5% of revenue
• Marketing variable expenses: 10% of revenue
• Annual fixed selling expenses $738447
• Annual fixed administrative expenses $1801469

The company’s margin of safety in terms of revenues is:

Comment on the following article, extracted from the textbook (Horngren, 16th edition, page 368).

While this is an open-book exam, direct copying of content from the textbook or class notes will not earn points. Answers should demonstrate your understanding and application of the concepts.

Comment on the following article, extracted from the textbook (Horngren, 16th edition, page 368).

While this is an open-book exam, direct copying of content from the textbook or class notes will not earn points. Answers should demonstrate your understanding and application of the concepts.

Company X employs 4 designers and 6 accounts managers. Direct and indirect costs are applied on a professional labor-hour basis that includes both designers and account managers. Company X presented the following information:

• Indirect costs: $300000
• Annual salary of each designer: $90000
• Annual salary of each account manager: $60000
• Total professional hours: 15000

The following information is available for Company X, with fixed costs at $640000:

Product A:

• Units sold: 8000
• Selling price: $100 /unit
• Variable costs: $40 /unit

Product B:

• Units sold: 2000
• Selling price: $200 /unit
• Variable costs: $120 /unit