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  • Siren Company Builds Custom Fishing Lures For Sporting Goods Stores

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    Muhammad Shahid
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    Siren Company builds custom fishing lures for sporting goods stores. In 2017, its first year of operations, Siren incurred various variable and fixed costs for materials, labor, manufacturing overhead, and selling/administrative expenses. It sold 80,000 lures for $25 each and produced 90,000 lures. The document provides instructions to calculate manufacturing costs and prepare income statements using variable and absorption costing methods.

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    Siren Company Builds Custom Fishing Lures for Sporting Goods Stores

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    Siren Company builds custom fishing lures for sporting goods stores. In 2017, its first year of operations, Siren incurred various variable and fixed costs for materials, labor, manufacturing overhead, and selling/administrative expenses. It sold 80,000 lures for $25 each and produced 90,000 lures. The document provides instructions to calculate manufacturing costs and prepare income statements using variable and absorption costing methods.

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    © All Rights Reserved
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    45 views2 pages

    Siren Company Builds Custom Fishing Lures For Sporting Goods Stores

    Uploaded by

    Muhammad Shahid
    Siren Company builds custom fishing lures for sporting goods stores. In 2017, its first year of operations, Siren incurred various variable and fixed costs for materials, labor, manufacturing overhead, and selling/administrative expenses. It sold 80,000 lures for $25 each and produced 90,000 lures. The document provides instructions to calculate manufacturing costs and prepare income statements using variable and absorption costing methods.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
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    Siren Company builds custom fishing lures for sporting

    goods stores #6048


    Siren Company builds custom fishing lures for sporting goods stores

    Siren Company builds custom fishing lures for sporting goods stores. In its first year of
    operations, 2017, the company incurred the following costs.

    Variable Costs per Unit

    Direct materials................................................ $7.50

    Direct labor.................................................... $3.45

    Variable manufacturing overhead........................... $5.80

    Variable selling and administrative expenses............. $3.90

    Fixed Costs per year

    Fixed manufacturing overhead............................ $225,000

    Fixed selling and administrative expenses............... $210,100

    Siren Company sells the fishing lures for $25. During 2017, the company sold 80,000 lures and
    produced 90,000 lures.

    Instructions

    (a) Assuming the company uses variable costing, calculate Siren's manufacturing cost per unit
    for 2017.

    (b) Prepare a variable costing income statement for 2017.

    (c) Assuming the company uses absorption costing, calculate Siren's manufacturing cost per
    unit for 2017.

    (d) Prepare an absorption costing income statement for 2017.

    Siren Company builds custom fishing lures for sporting goods stores
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