Cost of Goods Manufactured, using Variable Costing and Absorption CostingOn March 31, the end of the first year of operations, Barnard Inc., manufactured 6,400 units and sold 5,500 units. The following income statement was prepared, based on the variable costing concept:Barnard Inc.Variable Costing Income StatementFor the Year Ended March 31, 20Y1Sales $2,860,000 Variable cost of goods sold: Variable cost of goods manufactured$1,600,000 Inventory, March 31(225,000) Total variable cost of goods sold (1,375,000) Manufacturing margin $1,485,000 Total variable selling and administrative expenses (341,000) Contribution margin $1,144,000 Fixed costs: Fixed manufacturing costs$729,600 Fixed selling and administrative expenses231,000 Total fixed costs (960,600) Operating income $183,400 Determine the unit cost of goods manufactured, based on (a) the variable costing concept and (b) the absorption costing concept.Variable costing$fill in the blank 1Absorption costing$fill in the blank 2

Unit cost of goods manufactured under Absorption costing = Unit cost of goods manufactured under…

Answered: On March 31, the end of the first year…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Cost of Goods Manufactured, using Variable Costing and Absorption Costing

On March 31, the end of the first year of operations, Barnard Inc., manufactured 6,400 units and sold 5,500 units. The following income statement was prepared, based on the variable costing concept:

Barnard Inc. Variable Costing Income Statement For the Year Ended March 31, 20Y1
Sales		$2,860,000
Variable cost of goods sold:
Variable cost of goods manufactured	$1,600,000
Inventory, March 31	(225,000)
Total variable cost of goods sold		(1,375,000)
Manufacturing margin		$1,485,000
Total variable selling and administrative expenses		(341,000)
Contribution margin		$1,144,000
Fixed costs:
Fixed manufacturing costs	$729,600
Fixed selling and administrative expenses	231,000
Total fixed costs			(960,600)
Operating income		$183,400

Determine the unit cost of goods manufactured, based on (a) the variable costing concept and (b) the absorption costing concept.

Variable costing	$fill in the blank 1
Absorption costing	$fill in the blank 2

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