Sims Company began operations on January 1. Its cost and sales information for this year follow. $ 40 per unit $ 60 per unit $ 30 per unit Direct materials Direct labor Variable overhead Fixed overhead Variable selling and administrative expenses Fixed selling and administrative expenses Units produced Units sold Sales price $ 7,000,000 per year $ 11 per unit $ 4,500,000 per year 100,000 units 70,000 units $350 per unit 1. Prepare an income statement for the year using variable costing. 2. Prepare an income statement for the year using absorption costing.

Sims Company began operations on January 1. Its cost and sales information for this year follow. $ 40 per unit $ 60 per unit $ 30 per unit Direct materials Direct labor Variable overhead Fixed overhead Variable selling and administrative expenses Fixed selling and administrative expenses Units produced Units sold Sales price $ 7,000,000 per year $ 11 per unit $ 4,500,000 per year 100,000 units 70,000 units $350 per unit 1. Prepare an income statement for the year using variable costing. 2. Prepare an income statement for the year using absorption costing.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter18: Pricing And Profitability Analysis

Section: Chapter Questions

Problem 3CE: Pattison Products, Inc., began operations in October and manufactured 40,000 units during the month...

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