Carrington, Inc. began business at the start of the current year and maintains its accounting records on an absorption-cost basis. The following selected information appeared on the company's income statement and end-of-year balance sheet:

Carrington achieved its planned production level for the year. The company's fixed manufacturing overhead totaled $141,000, and the firm paid a 10% commission based on gross sales dollars to its sales force.
Required:
A. How many units did Carrington plan to produce during the year?
B. How much fixed manufacturing overhead did the company apply to each unit produced?
C. Compute Carrington's cost of goods sold.
D. How much variable cost did the company attach to each unit manufactured?

Question

Carrington, Inc. began business at the start of the current year and maintains its accounting records on an absorption-cost basis. The following selected information appeared on the company's income statement and end-of-year balance sheet:
  
Carrington achieved its planned production level for the year. The company's fixed manufacturing overhead totaled $141,000, and the firm paid a 10% commission based on gross sales dollars to its sales force. 
Required: 
A. How many units did Carrington plan to produce during the year?
B. How much fixed manufacturing overhead did the company apply to each unit produced?
C. Compute Carrington's cost of goods sold.
D. How much variable cost did the company attach to each unit manufactured?

Quizplus · Accepted Answer

The Answer of Carrington, Inc. began business at the start of the current year and maintains its accounting records on an absorption-cost basis. The following selected information appeared on the company's income statement and end-of-year balance sheet:
  
Carrington achieved its planned production level for the year. The company's fixed manufacturing overhead totaled $141,000, and the firm paid a 10% commission based on gross sales dollars to its sales force. 
Required: 
A. How many units did Carrington plan to produce during the year?
B. How much fixed manufacturing overhead did the company apply to each unit produced?
C. Compute Carrington's cost of goods sold.
D. How much variable cost did the company attach to each unit manufactured?