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Prepare the absorption costing income statements that Sarah would have shown Jason for both years (assume beginning FG Inventory cost per unit in Year 1 is the same as the current period's inventory cost per unit under absorption costing). Sales Less Unadjusted COGS COGS Fixed-MOH Volume Variance Adjusted COGS Gross Margin Less : SG&A Expenses Fixed Expenses Variable Expenses Operating Income $ $ Year 1 1224000 896580 i 896580 327420 309495 753750 -604245 tA $ tA LA Year 2 1224000 765000 315180 764430 459570 309495 770500 -620425

Prepare the absorption costing income statements that Sarah would have shown Jason for both years (assume beginning FG Inventory cost per unit in Year 1 is the same as the current period's inventory cost per unit under absorption costing). Sales Less Unadjusted COGS COGS Fixed-MOH Volume Variance Adjusted COGS Gross Margin Less : SG&A Expenses Fixed Expenses Variable Expenses Operating Income $ $ Year 1 1224000 896580 i 896580 327420 309495 753750 -604245 tA $ tA LA Year 2 1224000 765000 315180 764430 459570 309495 770500 -620425

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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Prepare the absorption costing income statements that Sarah would have shown Jason for both years (assume beginning FG Inventory cost per unit in Year 1 is the same as the current period's inventory cost per unit under absorption costing). Sales Less Unadjusted COGS COGS Fixed-MOH Volume Variance Adjusted COGS Gross Margin Less SG&A Expenses Fixed Expenses Variable Expenses Operating Income LA tA LA tA $ Year 1 1224000 896580 tal 896580 327420 309495 753750 -604245 tA Year 2 1224000 765000 315180 764430 459570 309495 770500 -620425
Transcribed Image Text:Prepare the absorption costing income statements that Sarah would have shown Jason for both years (assume beginning FG Inventory cost per unit in Year 1 is the same as the current period's inventory cost per unit under absorption costing). Sales Less Unadjusted COGS COGS Fixed-MOH Volume Variance Adjusted COGS Gross Margin Less SG&A Expenses Fixed Expenses Variable Expenses Operating Income LA tA LA tA $ Year 1 1224000 896580 tal 896580 327420 309495 753750 -604245 tA Year 2 1224000 765000 315180 764430 459570 309495 770500 -620425
Sarah used the following information to help her address Jason's concerns. She also noted there were no price or efficiency variances in either year. Any fixed-MOH volume variance is written off directly to COGS. Beginning FG Inventory Budgeted production Actual production Actual sales volume Selling price Budgeted variable manufacturing costs Budgeted variable operating costs Budgeted fixed manufacturing costs Budgeted fixed operating costs Year 1 4,500 units 301,500 units 301,500 units 306,000 units $4.00 per unit $1.90 per unit $0.60 per unit $99,495 $210,000 Year 2 301,500 units 308,200 units 306,000 units $4.00 per unit $1.90 per unit $0.60 per unit $99,495 $210,000
Transcribed Image Text:Sarah used the following information to help her address Jason's concerns. She also noted there were no price or efficiency variances in either year. Any fixed-MOH volume variance is written off directly to COGS. Beginning FG Inventory Budgeted production Actual production Actual sales volume Selling price Budgeted variable manufacturing costs Budgeted variable operating costs Budgeted fixed manufacturing costs Budgeted fixed operating costs Year 1 4,500 units 301,500 units 301,500 units 306,000 units $4.00 per unit $1.90 per unit $0.60 per unit $99,495 $210,000 Year 2 301,500 units 308,200 units 306,000 units $4.00 per unit $1.90 per unit $0.60 per unit $99,495 $210,000
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