AJ Manufacturing Company incurred $50,500 of fixed product cost and $40,400 of variable product cost during its first year of operation. Also during its first year, AJ incurred $16,150 of fixed and $13,100 of variable selling and administrative costs. The company sold all of the units it produced for $162,000. Required a. Prepare an income statement using the format required by generally accepted accounting Principles (GAAP). b. Prepare an income statement using the contribution margin approach. Complete this question by entering your answers in the tabs below. Required A Required B Prepare an income statement using the format required by generally accepted accounting Principles (GAAP). AJ MANUFACTURING COMPANY Income Statement Reguired A Required B >
AJ Manufacturing Company incurred $50,500 of fixed product cost and $40,400 of variable product cost during its first year of operation. Also during its first year, AJ incurred $16,150 of fixed and $13,100 of variable selling and administrative costs. The company sold all of the units it produced for $162,000. Required a. Prepare an income statement using the format required by generally accepted accounting Principles (GAAP). b. Prepare an income statement using the contribution margin approach. Complete this question by entering your answers in the tabs below. Required A Required B Prepare an income statement using the format required by generally accepted accounting Principles (GAAP). AJ MANUFACTURING COMPANY Income Statement Reguired A Required B >
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:AJ Manufacturing Company incurred $50,500 of fixed product cost and $40.400 of variable product cost during its first year of
operation. Also during its first year, AJ incurred $16,150 of fixed and $13,100 of variable selling and administrative costs. The company
sold all of the units it produced for $162,000.
Required
a. Prepare an income statement using the format required by generally accepted accounting Principles (GAAP).
b. Prepare an income statement using the contribution margin approach.
Complete this question by entering your answers in the tabs below.
Required A
Required B
Prepare an income statement using the format required by generally accepted accounting Principles (GAAP).
AJ MANUFACTURING COMPANY
Income Statement
Required B >
Mc
Graw
Hill
Expert Solution
Introduction :
Cost of goods sold = Variable product costs + Fixed product costs
Selling and administrative costs = Variable selling and administrative expense + Fixed selling and administrative expense
Variable costs = Variable product costs + Variable selling and administrative expense
Fixed costs = Fixed product costs + Fixed selling and administrative expense
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