Scribd
Upload
5 views1 page

Cost Analysis and Profit Metrics

This document provides calculations to determine various costs and margins for a product. It calculates: (1) The variable cost as $1,860,000 by taking the variable costs per unit of $62 and multiplying by 30,000 units. (2) The variable manufacturing cost as $1,710,000 by taking the variable manufacturing costs per unit of $57 and multiplying by 30,000 units. (3) The full absorption cost as $1,845,000 by taking the full absorption cost per unit of $61.50 and multiplying by 30,000 units.

Uploaded by

Camille Meneses
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
5 views1 page

Cost Analysis and Profit Metrics

This document provides calculations to determine various costs and margins for a product. It calculates: (1) The variable cost as $1,860,000 by taking the variable costs per unit of $62 and multiplying by 30,000 units. (2) The variable manufacturing cost as $1,710,000 by taking the variable manufacturing costs per unit of $57 and multiplying by 30,000 units. (3) The full absorption cost as $1,845,000 by taking the full absorption cost per unit of $61.50 and multiplying by 30,000 units.

Uploaded by

Camille Meneses
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

Module 2

Practice Problem
Problem 1
Required
Determine each of the following:
a. Variable cost
DM + DL + VMO+VMAC= VC per unit X UPS = Variable Cost
$21 + $24+ $12+$5 = $62.00/unit X $30 000 units= $ 1 860 000

b. Variable manufacturing cost


DM + DL + VM0= $57.00/unit X UPS = Variable Manufacturing Cost
$21 + $24 + $12= $57.00/ unit X 30 000 units= 1 710 000

c. Full absorption cost


DM + DL + VMO +FMOC per unit = CGS X UPS = Full Absorption Cost
$21 + $ 24 + $ 12 + $4.50 = $61.50 X 30 000 units= $1 845 000

d. Full cost
DM + DL +VMO+FMOC per unit+ VMAC + FMAC per unit= Full cost per unit X UPS = Full cost
$21 + $24 + $12 + $4.50 + $5 + $3.90 = $70.40 X 30 000= $2 112 000

e. Profit margin
SP – Full Cost = Profit Margin
$79 – $ 70.40 = $8.60

f. Gross margin
SP - CGS = Gross Margin
$79.00 - $61.50 = $17.50

g. Contribution margin
SP - VC per unit= Contribution Margin
$79 - $62 = $ 17

You might also like