3. Income statements - absorption costing vs direct costing. The Denton Corporation produced 24,000 units (normal capacity) of product during the first quarter of the year; 20,000 units were sold at $22 per unit. The costs of this production were: Materials.... Direct labor Factory overhead: Variable cost 120,000 96,000 Fixed cost. Marketing and administrative expenses for the quarter total $70,000; all are fixed expenses. Required: (1) An income statement using absorption costing. (2) An income statement using direct costing. $ 60,000 60,000

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3. Income statements - absorption costing vs direct costing. The Denton Corporation produced
24,000 units (normal capacity) of product during the first quarter of the year; 20,000 units were
sold at $22 per unit. The costs of this production were:
Materials....
Direct labor
Factory overhead:
Variable cost
120,000
96,000
Fixed cost.
Marketing and administrative expenses for the quarter total $70,000; all are fixed expenses.
Required:
(1) An income statement using absorption costing.
(2) An income statement using direct costing.
$ 60,000
60,000
Transcribed Image Text:3. Income statements - absorption costing vs direct costing. The Denton Corporation produced 24,000 units (normal capacity) of product during the first quarter of the year; 20,000 units were sold at $22 per unit. The costs of this production were: Materials.... Direct labor Factory overhead: Variable cost 120,000 96,000 Fixed cost. Marketing and administrative expenses for the quarter total $70,000; all are fixed expenses. Required: (1) An income statement using absorption costing. (2) An income statement using direct costing. $ 60,000 60,000
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