Absorption and Variable Costing Income Statements: Production Exceeds Sales Glendale Company sells its product at a unit price of $12.00. Unit manufacturing costs are direct materials, $2.00; direct labor, $3.00; and variable manufacturing overhead, $1.50. Total fixed manufacturing costs are $15,000 per year. Selling and administrative expenses are $1.00 per unit variable and $11,000 per year fixed. Though 25.000 units were produced during 2009. only 21,000 units were sold. There was no beginning inventory. (a) Prepare a functional income statement using absorption costing. (Do not use negative signs with your answers.) Glendale Company Functional (Absorption Costing) Income Statement For the year 2009 Sales Cost of goods sold Gross profit Other expenses: Variable selling and administrative S Fixed selling and administrative Net income 21,000 ✓ 11,000✔ Sales Variable expenses: Cost of goods sold Selling and administrative Contribution margin Fixed expenses: Manufacturing overhead Selling and administrative Net income S 136,500✔ 21,000 ✓ (b) Prepare a contribution income statement using variable costing. (Do not use negative signs with your answers.) Glendale Company Contribution (Variable Costing) Income Statement For the year 2009 15,000 ✓ 11,000 ✓ $ 252.000 ✓ 149.100✔ 102.900✔ $ $ 11,000 x 70.900 $ 252.000✔ 157.500 94,500✔ 26,000 ✓ 68,500
Absorption and Variable Costing Income Statements: Production Exceeds Sales Glendale Company sells its product at a unit price of $12.00. Unit manufacturing costs are direct materials, $2.00; direct labor, $3.00; and variable manufacturing overhead, $1.50. Total fixed manufacturing costs are $15,000 per year. Selling and administrative expenses are $1.00 per unit variable and $11,000 per year fixed. Though 25.000 units were produced during 2009. only 21,000 units were sold. There was no beginning inventory. (a) Prepare a functional income statement using absorption costing. (Do not use negative signs with your answers.) Glendale Company Functional (Absorption Costing) Income Statement For the year 2009 Sales Cost of goods sold Gross profit Other expenses: Variable selling and administrative S Fixed selling and administrative Net income 21,000 ✓ 11,000✔ Sales Variable expenses: Cost of goods sold Selling and administrative Contribution margin Fixed expenses: Manufacturing overhead Selling and administrative Net income S 136,500✔ 21,000 ✓ (b) Prepare a contribution income statement using variable costing. (Do not use negative signs with your answers.) Glendale Company Contribution (Variable Costing) Income Statement For the year 2009 15,000 ✓ 11,000 ✓ $ 252.000 ✓ 149.100✔ 102.900✔ $ $ 11,000 x 70.900 $ 252.000✔ 157.500 94,500✔ 26,000 ✓ 68,500
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Do not give answer in image formate
Transcribed Image Text:Absorption and Variable Costing Income Statements: Production Exceeds Sales
Glendale Company sells its product at a unit price of $12.00. Unit manufacturing costs are direct materials, $2.00; direct labor, $3.00; and variable manufacturing overhead, $1.50. Total fixed manufacturing costs are $15,000 per year. Selling and administrative expenses are $1.00
per unit variable and $11,000 per year fixed. Though 25,000 units were produced during 2009, only 21,000 units were sold. There was no beginning inventory.
(a) Prepare a functional income statement using absorption costing. (Do not use negative signs with your answers.)
Glendale Company
Functional (Absorption Costing) Income Statement
For the year 2009
Sales
Cost of goods sold
Gross profit
Other expenses:
Variable selling and administrative $
Fixed selling and administrative
Net income
Sales
Variable expenses:
Cost of goods sold
Selling and administrative
Contribution margin
21,000 ✓
11,000 ✓
Fixed expenses:
Manufacturing overhead
Selling and administrative
Net income
(b) Prepare a contribution income statement using variable costing. (Do not use negative signs with your answers.)
Glendale Company
Contribution (Variable Costing) Income Statement
For the year 2009
$ 136,500 ✓
21,000 ✓
15,000 ✓
11,000 ✓
$ 252,000 ✓
149,100 ✓
102,900 ✓
$
$
11,000 x
70,900 ✓
$ 252,000 ✓
157,500 ✓
94,500✔
26,000 ✓
68,500
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education