Sims Company, a manufacturer of tablet computers, began operations on January 1, 2019. Its cost and sales information for this year follows. Manufacturing costs Direct materials Direct labor 40 per unit 6e per unit Overhead costs Variable 30 per unit $7,350,000 (per year) Fixed Selling and administrative costs for the year Variable Fixed Production and sales for the year Units produced Units sold Sales price per unit $ 750,000 $4,750,000 105,000 units 75,000 units 360 per unit 1. Prepare an income statement for the year using variable costing. 2. Prepare an income statement for the year using absorption costing
Sims Company, a manufacturer of tablet computers, began operations on January 1, 2019. Its cost and sales information for this year follows. Manufacturing costs Direct materials Direct labor 40 per unit 6e per unit Overhead costs Variable 30 per unit $7,350,000 (per year) Fixed Selling and administrative costs for the year Variable Fixed Production and sales for the year Units produced Units sold Sales price per unit $ 750,000 $4,750,000 105,000 units 75,000 units 360 per unit 1. Prepare an income statement for the year using variable costing. 2. Prepare an income statement for the year using absorption costing
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Exercise 19-3 Income reporting under absorption costing and variable costing LO P2
Sims Company, a manufacturer of tablet computers, began operations on January 1, 2019. Its cost and sales information for this year
follows.
Manufacturing costs
Direct materials
Direct labor
40 per unit
60 per unit
Overhead costs
Variable
30 per unit
$7,350,000 (per year)
Fixed
Selling and administrative costs for the year
Variable
$ 750,000
$4,750,000
Fixed
Production and sales for the year
Units produced
Units sold
Sales price per unit
105,000 units
75,000 units
360 per unit
1. Prepare an income statement for the year using variable costing.
2. Prepare an income statement for the year using absorption costing
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