Santana Rey expects sales of Business Solutions' line of computer workstation furniture to equal 300 workstations (at a sales price of $3,300 each) for 2021. The workstations manufacturing costs include the following. $ 700 per unit $ 370 per unit $50 per unit $ 28,800 per year Selling and administrative expenses for these workstations follow Direct materials Direct labor Variable overhead Fixed overhead Variable Fixed $50 per unit $3,500 per year Santana is considering how many workstations to produce in 2021. She is confident that she will be able to sell any workstations in her 2021 ending inventory during 2022. However, Santana does not want to overproduce as she does not have sufficient storage space for many more workstations. Required: 1. Complete the following income statements using absorption costing 2. Complete the following income statements using variable costing. 3. Which costing method, absorption or variable, yields the higher income when 320 workstations are produced and 300 are sold? Complete this auection r
Santana Rey expects sales of Business Solutions' line of computer workstation furniture to equal 300 workstations (at a sales price of $3,300 each) for 2021. The workstations manufacturing costs include the following. $ 700 per unit $ 370 per unit $50 per unit $ 28,800 per year Selling and administrative expenses for these workstations follow Direct materials Direct labor Variable overhead Fixed overhead Variable Fixed $50 per unit $3,500 per year Santana is considering how many workstations to produce in 2021. She is confident that she will be able to sell any workstations in her 2021 ending inventory during 2022. However, Santana does not want to overproduce as she does not have sufficient storage space for many more workstations. Required: 1. Complete the following income statements using absorption costing 2. Complete the following income statements using variable costing. 3. Which costing method, absorption or variable, yields the higher income when 320 workstations are produced and 300 are sold? Complete this auection r
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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G.144.
Transcribed Image Text:Santana Rey expects sales of Business Solutions' line of computer workstation furniture to equal 300 workstations (at a sales price of
$3,300 each) for 2021. The workstations manufacturing costs include the following.
Direct materials
Direct labor
Variable overhead
Fixed overhead
$ 700 per unit
$ 370 per unit
$50 per unit
$ 28,800 per year
Selling and administrative expenses for these workstations follow
Variable
Fixed
$50 per unit
$3,500 per year
Santana is considering how many workstations to produce in 2021. She is confident that she will be able to sell any workstations in her
2021 ending inventory during 2022. However, Santana does not want to overproduce as she does not have sufficient storage space
for many more workstations.
Required:
1. Complete the following income statements using absorption costing
2. Complete the following income statements using variable costing.
3. Which costing method, absorption or variable, yields the higher income when 320 workstations are produced and 300 are sold?
Complete this nunction r
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