Reference no: EM133179274

Question - Smith Company has the following results for a certain year. All variances are written off as additions to (or deductions from) the standard cost of goods sold.

Sales: 150,000 units, at $20 $3,000,000

Net variance for standard variable manufacturing costs $33,000 unfavorable

Variable standard cost of goods manufactured $11 per unit

Variable selling and administrative expenses $3 per unit

Fixed selling and administrative expenses $650,000

Fixed manufacturing overhead $165,000

Maximum capacity per year 190,000 units

Expected production volume for year 150,000 units

Beginning inventory of finished goods 15,000 units

Ending inventory of finished goods 10,000 units

Required -

1. What is Beginning inventory: Absorption-costing basis?

2. What is Gross margin?

3. What is Operating income: Absorption-costing basis?

4. What is Beginning inventory: Variable-costing basis?

5. What is Contribution margin?

6. What is Operating income: Variable-costing basis? Show ALL of your calculations.