Lukin-Evers Corporation Reports the Following First Year Production Cost Information

question 127

Essay

Lukin-Evers Corporation reports the following first year production cost information. $$\begin{array} { l l } \text { Units produced } & 62,000 \text { units } \\\text { Units sold } & 59,000 \text { units } \\\text { Sales price } & \$ 350 \text { per unit } \\\text { Direct labor } & \$ 41 \text { per unit } \\\text { Direct materials } & \$ 15 \text { per unit } \\\text { Variable overhead } & \$ 9,300,000 \text { in total } \\\text { Fixed overhead } & \$ 4,340,000 \text { in total } \\\text { Operating expenses } & \$ 1,000,000\end{array}$$
(a.) Compute production cost per unit under variable costing.
(b.) Compute production cost per unit under absorption costing.
(c.) Determine the net income using variable costing.
(d.) Determine the net income using absorption costing.

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Definitions:

Demand Curves

Graphs showing the relationship between the price of a good and the quantity demanded by consumers, typically downward sloping.

Market Demand

The total quantity of a good or service that all consumers in a market are willing to purchase at various prices.

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A sweetener produced from corn starch that has been processed to convert its glucose into fructose, widely used in the food industry.

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A rise in the production or supply of corn, often due to factors like improved agricultural techniques or increased demand.