Mario Co.produces three products: LMC,DMC,KPC.For the coming year they expect to produce 160,000 units.Of these,65,000 will be LMC,40,000 will be DMC and 55,000 will be KPC.The following information was provided for the coming year:
Common fixed overhead is $984,000 and fixed selling and administrative expenses for Mario Co.is $881,000 per year.
Required:
A.Calculate the unit variable cost under variable costing.
B.Calculate the unit variable product cost.
C.Prepare a segmented variable-costing income statement for next year.
D.Should Mario Co.keep all product lines?

Question

Mario Co.produces three products: LMC,DMC,KPC.For the coming year they expect to produce 160,000 units.Of these,65,000 will be LMC,40,000 will be DMC and 55,000 will be KPC.The following information was provided for the coming year:
  Common fixed overhead is $984,000 and fixed selling and administrative expenses for Mario Co.is $881,000 per year.
Required: 
A.Calculate the unit variable cost under variable costing.
B.Calculate the unit variable product cost.
C.Prepare a segmented variable-costing income statement for next year.
D.Should Mario Co.keep all product lines?

Quizplus · Accepted Answer

The Answer of Mario Co.produces three products: LMC,DMC,KPC.For the coming year they expect to produce 160,000 units.Of these,65,000 will be LMC,40,000 will be DMC and 55,000 will be KPC.The following information was provided for the coming year:
  Common fixed overhead is $984,000 and fixed selling and administrative expenses for Mario Co.is $881,000 per year.
Required: 
A.Calculate the unit variable cost under variable costing.
B.Calculate the unit variable product cost.
C.Prepare a segmented variable-costing income statement for next year.
D.Should Mario Co.keep all product lines?

Mario CoProduces Three Products: LMC,DMC,KPC