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Tamarisk's Company builds custom fishing lures for sporting goods stores. In its first year of
operations, 2022, the company incurred the following costs:
Variable cost per unit
Direct materials-$6.60
Direct labour- $2.71
Variable manufacturing overhead-5.78
Variable selling and administrative expenses-3.90
Fixed costs for year
Fixed manufacturing overhead-288,456
Fixed selling and administrative expenses-240,200
Tamarisk's Company sells fishing lures for $25.00. During 2022, the company produced 96,100
lures and sold 80,200
(a)
Assume the company uses normal-absorption costing and uses the budgeted volume of 95,200
units to allocate the fixed overhead rate rather than the actual production volume of 96,100 units.
The company expenses production volume variance to cost of goods sold in the accounting
period in which it occurs. Do the following:
1. Calculate the manufacturing cost per unit. (Round per unit calculations and final answer to 2
decimal places, e.g. 15.25.)
2. Prepare a normal-absorption-costing income statement for 2022. (Round per unit calculations
to 2 decimal places, e.g. 15.25, and final answers to 0 decimal places, e.g. 125.)

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Tamarisks Company builds custom fishing lures for sporting goods st.pdf

  • 1. Tamarisk's Company builds custom fishing lures for sporting goods stores. In its first year of operations, 2022, the company incurred the following costs: Variable cost per unit Direct materials-$6.60 Direct labour- $2.71 Variable manufacturing overhead-5.78 Variable selling and administrative expenses-3.90 Fixed costs for year Fixed manufacturing overhead-288,456 Fixed selling and administrative expenses-240,200 Tamarisk's Company sells fishing lures for $25.00. During 2022, the company produced 96,100 lures and sold 80,200 (a) Assume the company uses normal-absorption costing and uses the budgeted volume of 95,200 units to allocate the fixed overhead rate rather than the actual production volume of 96,100 units. The company expenses production volume variance to cost of goods sold in the accounting period in which it occurs. Do the following: 1. Calculate the manufacturing cost per unit. (Round per unit calculations and final answer to 2 decimal places, e.g. 15.25.) 2. Prepare a normal-absorption-costing income statement for 2022. (Round per unit calculations to 2 decimal places, e.g. 15.25, and final answers to 0 decimal places, e.g. 125.)