Nelter Corporation, which has only one product, has provided the following data concerning its most recent month of operations: Selling price $ 118 Units in beginning inventory Units produced 325 6,300 6,340 285 Units sold Units in ending inventory Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative expense Fixed costs: Fixed manufacturing overhead Fixed selling and administrative expense $ 41 $ 25 $3 $ 16 $ 126,000 $ 76,080 The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. Required: a. Prepare a contribution format income statement for the month using variable costing. b. Prepare an income statement for the month using absorption costing.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Nelter Corporation, which has only one product, has provided the following data concerning its most recent month of operations:
Selling price
Units in beginning inventory
$ 118
325
6,300
6,340
Units produced
Units sold
285
Units in ending inventory
Variable costs per unit:
Direct materials
Direct labor
Variable manufacturing overhead
Variable selling and administrative expense
Fixed costs:
Fixed manufacturing overhead
Fixed selling and administrative expense
$ 41
$ 25
$3
$ 16
$ 126,000
$ 76,080
The company produces the same number of units every month, although the sales in units vary from month to month. The company's
variable costs per unit and total fixed costs have been constant from month to month.
Required:
a. Prepare a contribution format income statement for the month using variable costing.
b. Prepare an income statement for the month using absorption costing.
Transcribed Image Text:Nelter Corporation, which has only one product, has provided the following data concerning its most recent month of operations: Selling price Units in beginning inventory $ 118 325 6,300 6,340 Units produced Units sold 285 Units in ending inventory Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative expense Fixed costs: Fixed manufacturing overhead Fixed selling and administrative expense $ 41 $ 25 $3 $ 16 $ 126,000 $ 76,080 The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. Required: a. Prepare a contribution format income statement for the month using variable costing. b. Prepare an income statement for the month using absorption costing.
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