Cool Sky reports the following for its first year of operations. The company produced 40,000 units and sold 32,000 units at a price of $140 per unit. Direct materials. Direct labor Variable overhead Fixed overhead Variable selling and administrative expenses Fixed selling and administrative expenses 2b. Assume the company uses variable costing. Prepare its income statement for the year under variable costing. Income Income Statement (Variable Costing) Sales Less: Variable expenses Variable cost of goods sold Variable selling and administrative expenses Variable overhead Contribution margin Less: Fixed expenses Fixed overhead Fixed selling and administrative expenses $ 262,400 $ 4,480,000 $ 60 per unit $ 22 per unit. $ 8 per unit 480,000 per year $ 12 per unit $ 100,000 per year. $ 262,400

FINANCIAL ACCOUNTING
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Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Cool Sky reports the following for its first year of operations. The company produced 40,000 units and sold 32,000 units
at a price of $140 per unit.
Direct materials.
Direct labor
Variable overhead
Fixed overhead
Variable selling and administrative expenses
Fixed selling and administrative expenses
2b. Assume the company uses variable costing. Prepare its income statement for the year under variable costing.
Income
Income Statement (Variable Costing)
Sales
Less: Variable expenses
Variable cost of goods sold
Variable selling and administrative expenses
Variable overhead
Contribution margin
Less: Fixed expenses
Fixed overhead
Fixed selling and administrative expenses
$
262,400
$ 4,480,000
$ 60 per unit
$ 22 per unit.
$ 8 per unit
480,000 per year
$ 12 per unit
$ 100,000 per year.
$
262,400
Transcribed Image Text:Cool Sky reports the following for its first year of operations. The company produced 40,000 units and sold 32,000 units at a price of $140 per unit. Direct materials. Direct labor Variable overhead Fixed overhead Variable selling and administrative expenses Fixed selling and administrative expenses 2b. Assume the company uses variable costing. Prepare its income statement for the year under variable costing. Income Income Statement (Variable Costing) Sales Less: Variable expenses Variable cost of goods sold Variable selling and administrative expenses Variable overhead Contribution margin Less: Fixed expenses Fixed overhead Fixed selling and administrative expenses $ 262,400 $ 4,480,000 $ 60 per unit $ 22 per unit. $ 8 per unit 480,000 per year $ 12 per unit $ 100,000 per year. $ 262,400
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