ViCom Produces a Wide Range of Consumer Electronics $\quad$ $\quad$

question 9

Essay

ViCom produces a wide range of consumer electronics. ViCom's Newark, New York, plant produces two types of cordless phones: 2.4 GHz and 6.0 GHz. The following table summarizes operations at the Newark ViCom plant for Year 1 and Year 2. $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$$\text { Year } 1 \quad\quad\quad\quad\quad \text { Year } 2$
$\begin{array}{|l|c|c|c|c|}\hline&2.4 & 6.0 & 2.4 & 6.0 \\ &\mathrm{GHz} & \mathrm{Ghz} & \mathrm{GHz} & \mathrm{Ghz}\\\hline \text { Units produced } & 120,000 & 70,000 & 90,000 & 50,000 \\\hline \text { Units sold } & 100,000 & 60,000 & 100,000 & 60,000 \\\hline \begin{array}{l}\text { Change in inventory } \\\text { (units) }\end{array} & 20,000 & 10,000 & -10.000 & 10,000 \\\hline\text {Variable}\\\text { manufacturing cost}\\\text { per unit:}\\\hline \text { Direct labor } & \$ 7.50 & \$ 8.00 & \$ 7.50 & \$ 8.00 \\\text { Direct material } & \$ 18.00 & \$ 24.00 & \$ 18.00 & \$ 24.00 \\\hline \text { Variable overhead } & \$ 2.00 & \$ 3.00 & \$ 2.00 & \$ 3.00 \\\hline \text { Selling price } & \$ 45.00 & \$ 78.00 & \$ 45.00 & \$ 78.00\\\hline\end{array}$ Fixed manufacturing overhead amounted to $4 million in each year. At the start of Year 1, there were no beginning inventories of either 2.4-GHz or 6.0-GHz cordless phones. ViCom uses FIFO to value inventories.
Required:
a. Prepare variable costing income statements for Year 1 and Year 2.
b. Prepare absorption costing income statements for Year 1 and Year 2. At the end of the year, fixed manufacturing overhead is absorbed to the two phone models using direct material as the allocation base.
c. Prepare a table that reconciles any differences in variable costing and absorption costing net incomes for Year 1 and Year 2.

Comprehend the role of person perception and social categorization in influencing human behavior and judgment.

Recognize the influence of physical attractiveness on other people's perceptions and attributions.

Identify and explain the phenomenon of cognitive dissonance.

Distinguish how culture influences attributions and social norms.

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Definitions:

Big Five Factor

The Big Five Factor model outlines five broad dimensions of personality traits seen to describe the human personality: openness, conscientiousness, extraversion, agreeableness, and neuroticism.

Agreeableness

A personality trait characterized by warmth, friendliness, and a tendency towards cooperative and empathetic behavior.

Political Office

A position of authority or command in the government held by an individual who has been elected or appointed to it.

Emotional Stability

A personality trait characterized by the consistent ability to remain calm, composed, and untroubled by stress or emotionally unsettling events.