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Gallatin County Motors Inc. Absorption Costing Income Statement For the Month Ended July 31 $ $ Fixed costs: $ b. Prepare an income statement according to the variable costing concept. Gallatin County Motors Inc. Variable Costing Income Statement For the Month Ended July 31 $ $

Gallatin County Motors Inc. Absorption Costing Income Statement For the Month Ended July 31 $ $ Fixed costs: $ b. Prepare an income statement according to the variable costing concept. Gallatin County Motors Inc. Variable Costing Income Statement For the Month Ended July 31 $ $

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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**Income Statements under Absorption and Variable Costing** **Gallatin County Motors Inc.** assembles and sells snowmobile engines. The company began operations on July 1 and operated at 100% capacity during the first month. The following data summarize the results for July: - **Sales (4,500 units):** $2,880,000 - **Production costs (5,000 units):** - Direct materials: $1,376,000 - Direct labor: $591,500 - Variable factory overhead: $96,500 - Fixed factory overhead: $151,500 - Total Production Costs: $2,215,500 - **Selling and administrative expenses:** - Variable selling and administrative expenses: $68,700 - Fixed selling and administrative expenses: $28,800 - Total Selling and Administrative Expenses: $97,500 This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below. **Tasks:** a. Prepare an income statement according to the absorption costing concept. *Note: The data and instructions are available in an online spreadsheet for further analysis.*
Transcribed Image Text:**Income Statements under Absorption and Variable Costing** **Gallatin County Motors Inc.** assembles and sells snowmobile engines. The company began operations on July 1 and operated at 100% capacity during the first month. The following data summarize the results for July: - **Sales (4,500 units):** $2,880,000 - **Production costs (5,000 units):** - Direct materials: $1,376,000 - Direct labor: $591,500 - Variable factory overhead: $96,500 - Fixed factory overhead: $151,500 - Total Production Costs: $2,215,500 - **Selling and administrative expenses:** - Variable selling and administrative expenses: $68,700 - Fixed selling and administrative expenses: $28,800 - Total Selling and Administrative Expenses: $97,500 This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below. **Tasks:** a. Prepare an income statement according to the absorption costing concept. *Note: The data and instructions are available in an online spreadsheet for further analysis.*
### Financial Statements for Gallatin County Motors Inc. #### Absorption Costing Income Statement **For the Month Ended July 31** 1. **(Select item)** ................. $ (Amount) 2. **(Select item)** ................. $ (Amount) 3. **(Select item)** ................. $ (Amount) 4. **(Select item)** ................. $ (Amount) --- **Instruction:** Prepare an income statement according to the variable costing concept. #### Variable Costing Income Statement **For the Month Ended July 31** 1. **(Select item)** ................. $ (Amount) 2. **(Select item)** ................. $ (Amount) 3. **(Select item)** ................. $ (Amount) ##### Fixed Costs: 1. **(Select item)** ................. $ (Amount) --- These templates are meant for educational purposes to illustrate the components of an absorption and variable costing income statement. Each line should be filled with the appropriate items and amounts based on the financial activities of Gallatin County Motors Inc. for the specified period.
Transcribed Image Text:### Financial Statements for Gallatin County Motors Inc. #### Absorption Costing Income Statement **For the Month Ended July 31** 1. **(Select item)** ................. $ (Amount) 2. **(Select item)** ................. $ (Amount) 3. **(Select item)** ................. $ (Amount) 4. **(Select item)** ................. $ (Amount) --- **Instruction:** Prepare an income statement according to the variable costing concept. #### Variable Costing Income Statement **For the Month Ended July 31** 1. **(Select item)** ................. $ (Amount) 2. **(Select item)** ................. $ (Amount) 3. **(Select item)** ................. $ (Amount) ##### Fixed Costs: 1. **(Select item)** ................. $ (Amount) --- These templates are meant for educational purposes to illustrate the components of an absorption and variable costing income statement. Each line should be filled with the appropriate items and amounts based on the financial activities of Gallatin County Motors Inc. for the specified period.
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