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What is the total variable contribution margin

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Reference no: EM133016524

Question - ABC manufactures and sells a pump used in a wide variety of applications. They are considering producing either 30,000 or 40,000 units during the period. Other information is presented in the schedule.

Information - 2019

Beginning inventory 0

Expected sales in units 30,000

Selling price per unit $17.50

Variable manufacturing cost per unit $6.25

Fixed manufacturing overhead cost (total) $150,000

Fixed Selling and administrative expense (total) $47,000

Variable selling expense $2.00/unit

Required - Prepare variable costing and absorption income statements using both the production levels above and answer the following questions.

1. What is the TOTAL VARIABLE CONTRIBUTION MARGIN at production of 40,000 units?

2. What is the ABSORPTION manufacturing unit cost at production of 30,000 units?

3. What is the ABSORPTION manufacturing unit cost at production of 40,000 units?

4. What is the VARIABLE Net Income at production of 40,000 units?

5. What is the ABSORPTION Net Income at production of 30,000 units?

6. What is the ABSORPTION Net Income at production of 40,000 units?

7. What is the value of MOH that is "buried" in inventory at production of 40,000 units?

Reference no: EM133016524

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