E6-17 Felde Company builds custom fishing lures for sporting goods stores. In its first year of operations, 2014, the company incurred the following costs.
|
Variable Cost per Unit |
Fixed Costs per Year |
|||
|
Direct materials |
$7.50 |
Fixed manufacturing overhead |
$225,000 |
|
|
Direct labor |
2.45 |
Fixed selling and administrative expenses |
240,100 |
|
|
Variable manufacturing overhead |
5.80 |
|||
|
Variable selling and administrative expenses |
3.90 |
|||
Felde Company sells the fishing lures for $25.00 During 2014, the company sold 80,000 lures and produced 90,000 lures
Instructions
(a) Assuming the company uses variable costing, calculate Felde manufacturing cost per unit for 2014.
(b) Prepare a variable costing income statement for 2014.
(c) Assuming the company uses absorption costing, calculate Felde manufacturing cost per unit for 2014.
(d) Prepare an absorption costing income statement for 2014.
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