Variable costs per unit: Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead ta ta ta ta $ $ 2722 $248.000
Variable costs per unit: Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead ta ta ta ta $ $ 2722 $248.000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Do not give image format
Transcribed Image Text:Lynch Company manl
operations:
Variable costs per unit:
Manufacturing:
Direct materials
Direct labor
and sells a single pr
Variable manufacturing overhead
Variable selling and administrative
Fixed costs per year:
Fixed manufacturing overhead
Fixed selling and administrative
The following costs were
$
$
$
$
12
7
2
2
$248,000
$158,000
ng the company
During the year, the company produced 31,000 units and sold 21,000 units. The selling price of the company's product is $44 per unit.
Required:
1. Assume that the company uses absorption costing:
a. Compute the unit product cost.
b. Prepare an income statement for the year.
2. Assume that the company uses variable costing:
a. Compute the unit product cost.
b. Prepare an income statement for the year.
Complete this question by entering your answers in the tabs below.
Transcribed Image Text:Complete this question by entering your answers in the tabs below.
Req 1A
Req 1B
Sales
Prepare an income statement for the year. Assume that the company uses variable costing
Lynch Company
Variable Costing Income Statement
Variable cost of goods sold
Contribution margin
Fixed selling and administrative
Req 2A
Net operating income
Req 2B
X
✓$ 441,000
X
* «* «
X
X
>>
158,000
X
$ 924,000
441,000
483,000
158,000
$325,000
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