Bonita, Inc. is a company that manufactures and sells a single product. Unit sales for each of the four quarters of 2020 are projected as follows. Quarter Units First 78,400 Second 147,000 Third 539,000 Fourth 117,600 Annual total 882,000 Bonita incurs variable manufacturing costs of $0.40 per unit and variable nonmanufacturing costs of $0.40 per unit. Bonita will incur fixed manufacturing costs of $705,600 and fixed nonmanufacturing costs of $1,058,400. Bonita will sell its product for $4 per unit. (a) Determine the amount of net income Bonita will report in each of the four quarters of 2020, assuming actual sales are as projected and employing the integral approach to interim financial reporting. (Ignore income taxes.) Repeat the analysis under the discrete approach.
Bonita, Inc. is a company that manufactures and sells a single product. Unit sales for each of the four quarters of 2020 are projected as follows. Quarter Units First 78,400 Second 147,000 Third 539,000 Fourth 117,600 Annual total 882,000 Bonita incurs variable manufacturing costs of $0.40 per unit and variable nonmanufacturing costs of $0.40 per unit. Bonita will incur fixed manufacturing costs of $705,600 and fixed nonmanufacturing costs of $1,058,400. Bonita will sell its product for $4 per unit. (a) Determine the amount of net income Bonita will report in each of the four quarters of 2020, assuming actual sales are as projected and employing the integral approach to interim financial reporting. (Ignore income taxes.) Repeat the analysis under the discrete approach.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Bonita, Inc. is a company that manufactures and sells a single product. Unit sales for each of the four quarters of 2020 are projected as follows.
Bonita incurs variablemanufacturing costs of $0.40 per unit and variable nonmanufacturing costs of $0.40 per unit. Bonita will incur fixed manufacturing costs of $705,600 and fixed nonmanufacturing costs of $1,058,400. Bonita will sell its product for $4 per unit.
| Quarter | Units | ||
| First | 78,400 | ||
| Second | 147,000 | ||
| Third | 539,000 | ||
| Fourth | 117,600 | ||
| Annual total | 882,000 |
Bonita incurs variable
(a)
Determine the amount of net income Bonita will report in each of the four quarters of 2020, assuming actual sales are as projected and employing the integral approach to interim financial reporting. (Ignore income taxes.) Repeat the analysis under the discrete approach.
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