Sims Company, a manufacturer of tablet computers, began operations on January 1, 2017. Its cost and sales information for this year follows. Manufacturing costs Direct materials Direct labor Overhead costs for the year Variable overhead Fixed overhead Selling and administrative costs for the year Variable Fixed Production and sales for the year Units produced Units sold Sales price per unit $ $2,200,000 $8,800,000 35 per unit 55 per unit $ 775,000 $4,500,000 $ 110,000 units 80,000 units 360 per unit 1. Prepare an income statement for the year using variable costing.
Sims Company, a manufacturer of tablet computers, began operations on January 1, 2017. Its cost and sales information for this year follows. Manufacturing costs Direct materials Direct labor Overhead costs for the year Variable overhead Fixed overhead Selling and administrative costs for the year Variable Fixed Production and sales for the year Units produced Units sold Sales price per unit $ $2,200,000 $8,800,000 35 per unit 55 per unit $ 775,000 $4,500,000 $ 110,000 units 80,000 units 360 per unit 1. Prepare an income statement for the year using variable costing.
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter2: Basic Cost Management Concepts
Section: Chapter Questions
Problem 22E: Ellerson Company provided the following information for the last calendar year: During the year,...
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![Sims Company, a manufacturer of tablet computers, began operations on January 1, 2017. Its cost and sales
information for this year follows.
Manufacturing costs
Direct materials
Direct labor
Overhead costs for the year
Variable overhead
Fixed overhead
Selling and administrative costs for the year
Variable
Fixed
Production and sales for the year
Units produced
Units sold
Sales price per unit
$
Required 1
$2,200,000
$8,800,000
Net income (loss)
35 per unit
55 per unit
$ 775,000
$4,500,000
$
1. Prepare an income statement for the year using variable costing.
2. Prepare an income statement for the year using absorption costing.
3. Under what circumstance(s) is reported income identical under both absorption costing and variable costing?
Required 2 Required 3
Prepare an income statement for the year using variable costing.
SIMS COMPANY
Variable Costing Income Statement
Complete this question by entering your answers in the tabs below.
110,000 units
80,000 units
360 per unit](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe4ed5fdc-615e-41e4-8f3e-2625b05fe386%2Fd73b8457-dd33-49e0-b78b-7e9ef116795f%2Fojdz03m_processed.png&w=3840&q=75)
Transcribed Image Text:Sims Company, a manufacturer of tablet computers, began operations on January 1, 2017. Its cost and sales
information for this year follows.
Manufacturing costs
Direct materials
Direct labor
Overhead costs for the year
Variable overhead
Fixed overhead
Selling and administrative costs for the year
Variable
Fixed
Production and sales for the year
Units produced
Units sold
Sales price per unit
$
Required 1
$2,200,000
$8,800,000
Net income (loss)
35 per unit
55 per unit
$ 775,000
$4,500,000
$
1. Prepare an income statement for the year using variable costing.
2. Prepare an income statement for the year using absorption costing.
3. Under what circumstance(s) is reported income identical under both absorption costing and variable costing?
Required 2 Required 3
Prepare an income statement for the year using variable costing.
SIMS COMPANY
Variable Costing Income Statement
Complete this question by entering your answers in the tabs below.
110,000 units
80,000 units
360 per unit
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