Absorption-Costing Income StatementDuring the most recent year, Osterman Company had the following data:Units in beginning inventory—Units produced10,000Units sold ($47 per unit)9,300Variable costs per unit: Direct materials$9Direct labor$6Variable overhead$4Fixed costs: Fixed overhead per unit produced$5Fixed selling and administrative$138,000Required:1. Calculate the cost of goods sold under absorption costing. Prepare an income statement using absorption costing. Enter amounts as positive numbers.Osterman CompanyIncome Statement under Absorption CostingFor the Most Recent YearSales Less: Cost of goods sold Gross margin Less: Selling and administrative expenses Operating income

Cost of goods sold = (Direct materials + Direct labor + Variable overhead + Fixed overhead) x no. of…

Answered: During the most recent year, Osterman…

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter3: Cost Behavior And Cost Forecasting

Section: Chapter Questions

Problem 23BEA: Absorption-Costing Income Statement Refer to the data for Osterman Company above. Required: 1....

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Absorption-Costing Income Statement

During the most recent year, Osterman Company had the following data:

Units in beginning inventory	—
Units produced	10,000
Units sold ($47 per unit)	9,300
Variable costs per unit:
Direct materials	$9
Direct labor	$6
Variable overhead	$4
Fixed costs:
Fixed overhead per unit produced	$5
Fixed selling and administrative	$138,000

Required:

1. Calculate the cost of goods sold under absorption costing.

Prepare an income statement using absorption costing. Enter amounts as positive numbers.

Osterman Company
Income Statement under Absorption Costing
For the Most Recent Year
Sales
Less: Cost of goods sold
Gross margin
Less: Selling and administrative expenses
Operating income

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