Purchase Solution

# HJ Turner Corporation

Not what you're looking for?

HJ Turner Corporation produces a single product. Data concerning the company's operations last year appear below:

Units in beginning inventory.........................
0

Units produced..............................................
10,000

Units sold.......................................................
9,000

Selling price per unit......................................
\$60

Variable costs per unit:

Direct materials...........................................
\$15

Direct labor.................................................
\$5

\$2

\$4

Fixed costs in total:

\$200,000

\$70,000

Assume direct labor is a variable cost.

Required:

a. Compute the unit product cost under both absorption and variable costing.

b. Prepare an income statement for the year using absorption costing.

c. Prepare an income statement for the year using variable costing.

d. Prepare a report reconciling the difference in net operating income between absorption and variable costing for the year.

##### Solution Summary

This solution is comprised of a detailed explanation and calculation to compute the unit product cost under both absorption and variable costing, preparing an income statement for the year using absorption & variable costing, and preparing a report reconciling the difference in net operating income between absorption and variable costing for the year.

##### Solution Preview

HJ Turner Corporation produces a single product. Data concerning the company's operations last year appear below:

Units in beginning inventory......................... 0
Units produced.............................................. 10,000
Units sold....................................................... 9,000

Selling price per unit...................................... \$60

Variable costs per unit:

Direct materials........................................... \$15

Direct labor................................................. \$5

Fixed costs in total:

Assume direct labor is a variable cost.
Required:

a. ...

##### Understanding Management

This quiz will help you understand the dimensions of employee diversity as well as how to manage a culturally diverse workforce.

##### Understanding the Accounting Equation

These 10 questions help a new student of accounting to understand the basic premise of accounting and how it is applied to the business world.

##### Operations Management

This quiz tests a student's knowledge about Operations Management

##### Balance Sheet

The Fundamental Classified Balance Sheet. What to know to make it easy.