AJ Manufacturing Company incurred $53,500 of fixed product cost and $42,800 of variable product cost during its first year of operation. Also during its first year, AJ incurred $17,050 of fixed and $13,700 of variable selling and administrative costs. The company sold all of the units it produced for $174,000. Required Prepare an income statement using the format required by generally accepted accounting Principles (GAAP). Prepare an income statement using the contribution margin approach.
AJ Manufacturing Company incurred $53,500 of fixed product cost and $42,800 of variable product cost during its first year of operation. Also during its first year, AJ incurred $17,050 of fixed and $13,700 of variable selling and administrative costs. The company sold all of the units it produced for $174,000. Required Prepare an income statement using the format required by generally accepted accounting Principles (GAAP). Prepare an income statement using the contribution margin approach.
Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter4: Accounting For Factory Overhead
Section: Chapter Questions
Problem 4P: Using the data in P4-2 and Microsoft Excel: 1. Separate the variable and fixed elements. 2....
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AJ Manufacturing Company incurred $53,500 of fixed product cost and $42,800 of variable product cost during its first year of operation. Also during its first year, AJ incurred $17,050 of fixed and $13,700 of variable selling and administrative costs. The company sold all of the units it produced for $174,000.
Required
- Prepare an income statement using the format required by generally accepted accounting Principles (GAAP).
- Prepare an income statement using the contribution margin approach.
Transcribed Image Text:Complete this question by entering your answers in the tabs below.
Required A Required B
Prepare an income statement using the contribution margin approach.
AJ MANUFACTURING COMPANY
Income Statement
Variable cost
Contribution margin
Fixed cost
Net income
$ 174,000
$ 46,950
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