Rey Company’s only product sells for $222 per unit. Data for its first year of operations follow.   Direct materials $ 26 per unit Direct labor $ 34 per unit Variable overhead $ 12 per unit Fixed overhead $ 364,000 per year Variable selling and administrative expenses $ 24 per unit Fixed selling and administrative expenses $ 212,000 per year Units produced and sold 26,000 units   1. Prepare an income statement for the year using absorption costing 2. Prepare an income statement for the year using variable costing.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Rey Company’s only product sells for $222 per unit. Data for its first year of operations follow.
 

Direct materials $ 26 per unit
Direct labor $ 34 per unit
Variable overhead $ 12 per unit
Fixed overhead $ 364,000 per year
Variable selling and administrative expenses $ 24 per unit
Fixed selling and administrative expenses $ 212,000 per year
Units produced and sold 26,000 units

 
1. 
Prepare an income statement for the year using absorption costing
2. Prepare an income statement for the year using variable costing.

REY COMPANY
Income Statement (Absorption Costing)
Transcribed Image Text:REY COMPANY Income Statement (Absorption Costing)
Income
REY COMPANY
Income Statement (Variable Costing)
Transcribed Image Text:Income REY COMPANY Income Statement (Variable Costing)
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