Compute the product cost per container of frozen

Assignment Help Managerial Accounting
Reference no: EM131367242 , Length:

Exercise -1 Straightforward Problem on Absorption versus Variable Costing

2(a).Net income:$200,000
3. Cost of goods sold under absorption costing: $1,500,000

Question :

Skinny Dippers, Inc. produces nonfat frozen yogurt. The product is sold in five-gallon containers, which have the following price and variable costs.

Sales price ..................... $15
Direct material .....................5
Direct labor .....................2
Variable overhead .....................3

Budgeted fixed overhead in 20x1, the company's first year of operations, was $300,000. Planned and actual production was 150,000 five-gallon containers, of which 125,000 were sold. Skinny Dippers, Inc. incurred the following selling and administrative expenses.

Fixed ..................... ..................... $50000 for the year
Variable ..................... ..................... $1 per container sold

Required :

1. Compute the product cost per container of frozen yogurt under ( a ) variable costing and ( b ) absorption costing.

2. Prepare income statements for 20x1 using ( a ) absorption costing and ( b ) variable costing.

3.Reconcile the income reported under the two methods by listing the two key places where the income statements differ.

4. Reconcile the income reported under the two methods using the shortcut method.

Exercise -2 Physical-Units Method; Joint cost Allocation


Breakfasttime Cereal Company manufactures two breakfast cereals in a joint process. Cost and quantity information is as follows:

Joint Cost Cereal Quantity at Split -off point Sales Price per Kilogram
$30,000 Yummies .................. 12,000 kilograms $2.00

Crummies .................. 8,000kilograms 2.5

Required :

Use the physical-units method to allocate the company's joint production cost between

Yummies and Crummies.

Exercise-3 Net - Realizable -Value Method ;Joint Cost Allocation


Refer to the data given in Exercise 17-20 . Breakfasttime Cereal Company has an opportunity to process its Crummies further into a mulch for ornamental shrubs. The additional processing operation costs $.50 per kilogram, and the mulch will sell for $3.50 per kilogram.


1) Should Breakfasttime's management decide to process Crummies into the mulch? Why?

2) Suppose the company does process Crummies into the mulch. Use the net-realizable-value method to allocate the joint production cost between the mulch and the Yummies.

Verified Expert

In this we have calculated the cost under variable and absorption costing method and reconciled the differences between both the method. Further we have given the reason for difference between variable and absorption costing method. In next sheet we have done the allocation of joint cost at split off point amount two products.

Reference no: EM131367242

Number of pounds of raw materials

Compute the number of units of product to be produced during October. Compute  the number of pounds of raw materials to be purchased during October.

Calculate d and rs total operating income

Management is considering adding a new product to the company's product line. The new item will have $8.25 of variable costs per unit. Calculate the selling price that will be

Calculate the ratio for 2012 that would reflect

The extent to which the claims of short-term creditors are covered by assets that can be translated into cash in the short term and the extent to which long-term debt is cov

Calculate the profit under marginal and absorption costing

BLB00045-5 Managerial Accounting Assignment. You are provided with the following data from the books of the company Paragon Product Ltd., Calculate the profit under marginal c

Which department contributes the largest dollar

Use the information in the following table to compute each department's contribution to overhead (both in dollars and as a percent). Which department contributes the largest d

Variable costing-segment reporting

Michaels Company segments its income statement in its east and west divisions.The company's entire sales, contribution margin ratio, and net operating income are $600,000, 5

What is a managerial accounting model

How can we reconcile the two statements? What is a managerial accounting model? Read the article and comment on some aspect of the discussion in an attempt to shed some ligh

What are your thoughts on the given articles

ACC 400- What are your thoughts on these articles? Do you agree with Congress' initial opposition to FASB's attempts to require that these stock options be included as incom



2/6/2017 5:30:56 AM

Hi ExpertsMind! The paper looks GREAT! Is there an additional charge for the additional for 2 more questions? If not, I might want to keep it generally as it is on the grounds that it is PERFECT!!! Incidentally, I have a few more papers that I will submit and might want to demand you! When I submit the request, do I simply say your name or do I get in touch with you by email? Much appreciated again for your assistance and have an awesome day! :-)


1/23/2017 12:13:26 AM

I have 3 problem to be done. I am attaching the excel document with the question and the instruction. Any future question pls ctc me. Thank you,

Write a Review

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd