Horngren's Financial & Managerial Accounting, The Managerial Chapters (6th Edition)
6th Edition
ISBN: 9780134486857
Author: Tracie L. Miller-Nobles, Brenda L. Mattison, Ella Mae Matsumura
Publisher: PEARSON
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Chapter 21, Problem 18E
1.
To determine
State the costing method that produces higher operating income and explain the reason.
2.
To determine
State the costing method that produces higher balance in finished goods inventory as of April 30 and explain the reason.
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Students have asked these similar questions
1. In presenting inventory on the balance sheet December 31, 2021, the unit cost under absorption costing is?
2. What is the net income for 2021 under variable costing?
Compute for:a. Unit product cost under absorption costing.
b. Unit product cost under variable costing.
c. Ending inventory (February) under variable costing.
d. Ending inventory (February) under absorption costing.
McCracken Aerial, Inc., produces and sells a unique type of TV antenna. The company
has just opened a new plant to manufacture the antenna, and the following cost and
revenue data have been provided for the first month of the plant's operation in the form of
a worksheet.
Beginning inventory.
Units produced
80,000
Units sold
70,000
Selling price per unit
Selling and administrative expenses:
$30
Variable per unit ..
Fixed (total) ...
$1
$160,000
Manufacturing costs
Direct materials cost per unit
$10
Direct labor cost per unit ...
Variable manufacturing overhead cost per unit.
Fixed manufacturing overhead cost (total) .
$4
$2
$640,000
Chapter 21 Solutions
Horngren's Financial & Managerial Accounting, The Managerial Chapters (6th Edition)
Ch. 21 - Pierce Company had the following costs: Calculate...Ch. 21 - Hayden Company has 50 units in Finished Goods...Ch. 21 - The Stark Company manufactures a product that is...Ch. 21 - Chaney Company provides lawn care services....Ch. 21 - Prob. 1QCCh. 21 - Prob. 2QCCh. 21 - Donovan Company incurred the following costs while...Ch. 21 - Donovan Company incurred the following costs while...Ch. 21 - Donovan Company incurred the following costs while...Ch. 21 - Donovan Company incurred the following costs while...
Ch. 21 - Donovan Company incurred the following costs while...Ch. 21 - Prob. 8QCCh. 21 - Prob. 9QCCh. 21 - Prob. 10QCCh. 21 - What is absorption costing?Ch. 21 - What is variable costing?Ch. 21 - How are absorption costing and variable costing...Ch. 21 - Prob. 4RQCh. 21 - Prob. 5RQCh. 21 - When units produced are less than units sold, how...Ch. 21 - Explain why the fixed manufacturing overhead cost...Ch. 21 - Prob. 8RQCh. 21 - Prob. 9RQCh. 21 - Prob. 10RQCh. 21 - Why is it appropriate to use variable costing when...Ch. 21 - Prob. 12RQCh. 21 - Prob. 13RQCh. 21 - Prob. 14RQCh. 21 - Prob. 15RQCh. 21 - How can variable costing be used in service...Ch. 21 - Classify each cost by placing an X in the...Ch. 21 - Martin Company had the following costs: Calculate...Ch. 21 - Martin Company had the following costs: Calculate...Ch. 21 - Dracut Company reports the following information...Ch. 21 - Dracut Company reports the following information...Ch. 21 - Adamson, Inc. has the following cost data for...Ch. 21 - Refer to your answers to Short Exercise S21-6....Ch. 21 - Refer to your answers to Short Exercise S21-6....Ch. 21 - Prob. 9SECh. 21 - Prob. 10SECh. 21 - Prob. 11SECh. 21 - Prob. 12SECh. 21 - Meyer Company reports the following information...Ch. 21 - Concord, Inc. has collected the following data for...Ch. 21 - Concord, Inc. has collected the following data for...Ch. 21 - ReVitalAde produced 13,000 cases of powdered drink...Ch. 21 - Refer to Exercise E21-16. Requirements 1. Prepare...Ch. 21 - Prob. 18ECh. 21 - Refer to your answers to Exercise E21-16. In May...Ch. 21 - Refer to Exercise E21-19. Requirements 1. Prepare...Ch. 21 - The Sweet Treats Company manufactures candy that...Ch. 21 - Sampler Company sells two products, Sigma and...Ch. 21 - Prob. 23ECh. 21 - Prob. 24ECh. 21 - Sherman Company provides carpet cleaning services...Ch. 21 - Prob. 26ECh. 21 - Prob. 27APCh. 21 - Prob. 28APCh. 21 - Relative Furniture Company manufactures and sells...Ch. 21 - Prob. 30APCh. 21 - Professional Pool Cleaning Service provides pool...Ch. 21 - Prob. 32BPCh. 21 - Game Source manufactures video games that it sells...Ch. 21 - Prob. 34BPCh. 21 - The 2018 data that follow pertain to Elis Electric...Ch. 21 - Divine Pool Cleaning Service provides pool...Ch. 21 - Prob. 37PCh. 21 - This problem continues the Piedmont Computer...Ch. 21 - CF Industries Holdings, Inc. is one of the largest...Ch. 21 - The Hurley Hat Company manufactures baseball hats....Ch. 21 - Sampson Company operates a manufacturing facility...Ch. 21 - In 100 words or fewer, explain the main...
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Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- d. What was the cost of products completed during Febuary? e. What was the balance of the Work-in-Process Inventory account at the end of Fabuary? f. What was the operating profit for Febuary? Any over- or underapplied overhead is written off to Cost of Goods Sold? Please provide an explanation it would be of great help with my learning. Thank you <3arrow_forwardWhich of these occur when the costs of goods sold exceeds the costs of goods manufactured? Group of answer choices The finished goods inventory decreases over the period. The work-in-process inventory increases over the period. The finished goods inventory increases over the period. The work-in-process inventory decreases over the period.arrow_forwardA. Compute the ending inventory (February) under variable costing.B. Compute the ending inventory (February) under absorption costing.arrow_forward
- TB MC Qu. 3-30 (Static) The final step in recognizing the... The final step in recognizing the completion of production requires a company to: Multiple Choice add direct materials to Finished-Goods Inventory. add direct labor to Work-in-Process Inventory. add direct materials, direct labor, and manufacturing overhead to Work-in-Process Inventory. debit Finished-Goods Inventory and credit Work-in-Process Inventory. debit Work-in-Process Inventory and credit Finished-Goods Inventory.arrow_forward1. Compute the unit product cost under absorption costing. 2. Compute the net income under absorption costing. 3. What will be the value of the ending inventory if the company is using absorption costing?arrow_forwardQUESTIONS A. Compute for the ending Finished Goods Inventory under Absorption costing B. Compute for the Ending Finished Goods Inventory under Variable Costing methodarrow_forward
- The cost of the ending inventory under absorption costing is higher than the cost of ending inventory under varibale costing by 1. an amount equal to the fixed overhead cost per unit. 2. an amount computed by multiplying the units in the ending inventory by the fixed costs per unit. 3. an amount equal to the difference in the income amounts under both costing methods. 4. the amount equal to the fixed overhead cost charged to expense during the period.arrow_forwardThe first step in determining the cost per EUP per cost component under the weighted average method is to * a. add the beginning Work in Process Inventory cost to the current period's production cost.b. divide the current period's production cost by the equivalent units.c. subtract the beginning Work in Process Inventory cost from the current period's production cost.d. divide the current period's production cost into the EUP.arrow_forwardWhich is nor needed to compute equivalent units of production? A. the percentage of completion for inventory still in process B. the number of units transferred out C. the number of units started and completed D. the material cost per unitarrow_forward
- Cost of quality and value-added/non-value-added reports for a service company A. Using the information in Exercise 17, identify the cost of quality classification for each activity and whether the activity is value-added or non-value-added. B. Prepare a cost of quality report. Assume that sales are 3,000,000. (Round percentages to one decimal place.) C. Prepare a value-added/non-value-added analysis. D. Interpret the information in (B) and (C).arrow_forwardInventory Valuation under Absorption Costing Refer to the data for Judson Company above. Required: 1. How many units are in ending inventory? 2. Using absorption costing, calculate the per-unit product cost. 3. What is the value of ending inventory under absorption costing? Use the following information for Brief Exercises 3-21 and 3-22: During the most recent year, Judson Company had the following data associated with the product it makes:arrow_forwardInventory Valuation under Variable Costing Refer to the data for Judson Company above. Required: 1. How many units are in ending inventory? 2. Using variable costing, calculate the per-unit product cost. 3. What is the value of ending inventory under variable costing? Use the following information for Brief Exercises 3-21 and 3-22: During the most recent year, Judson Company had the following data associated with the product it makes:arrow_forward
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