Oak Mart, a producer of solid oak tables, reports the following data from its second year of business. Sales price per unit$300per unitUnits produced this year 115,000unitsUnits sold this year 118,750unitsUnits in beginning-year inventory 3,750unitsBeginning inventory costs Variable (3,750 units × $140)$525,000 Fixed (3,750 units × $70) 262,500 Total$787,500 Manufacturing costs this year Direct materials$46per unitDirect labor$64per unitOverhead costs this year Variable overhead$3,200,000 Fixed overhead$7,400,000 Selling and administrative costs this year Variable$1,450,000 Fixed 4,000,000 2. Prepare the current-year income statement for the company using absorption costing. OAK MART COMPANYVariable Costing Income StatementBeginning inventory:Manufacturing costs this yearNet income (loss)

Name: Oak Mart, a producer of solid oak tables, reports the following data f
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Description: Oak Mart, a producer of solid oak tables, reports the following data from its second year of business. Sales price per unit$300per unitUnits produced this year 115,000unitsUnits sold this year 118,750unitsUnits in beginning-year inventory 3,750un

The income statement is prepared to find the net income during the year.

Answered: Oak Mart, a producer of solid oak…

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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Oak Mart, a producer of solid oak tables, reports the following data from its second year of business.


Sales price per unit	$	300	per unit
Units produced this year		115,000	units
Units sold this year		118,750	units
Units in beginning-year inventory		3,750	units
Beginning inventory costs
Variable (3,750 units × $140)	$	525,000
Fixed (3,750 units × $70)		262,500
Total	$	787,500
Manufacturing costs this year
Direct materials	$	46	per unit
Direct labor	$	64	per unit
Overhead costs this year
Variable overhead	$	3,200,000
Fixed overhead	$	7,400,000
Selling and administrative costs this year
Variable	$	1,450,000
Fixed		4,000,000

2. Prepare the current-year income statement for the company using absorption costing.

OAK MART COMPANY
Variable Costing Income Statement
Beginning inventory:
Manufacturing costs this year
Net income (loss)

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