Sims Company began operations on January 1. Its cost and sales information for this year follow. $ 30 per unit $ 50 per unit $ 30 per unit Direct materials Direct labor Variable overhead Fixed overhead Variable selling and administrative expenses Fixed selling and administrative expenses Units produced Units sold Sales price $ 7,700,000 per year $ 11 per unit 1. Prepare an income statement for the year using variable costing. 2. Prepare an income statement for the year using absorption costing. Required 1 Required 2 $4,750,000 per year 110,000 units 80,000 units $360 per unit Complete this question by entering your answers in the tabs below. Prepare an income statement for the year using variable costing. SIMS COMPANY

Sims Company began operations on January 1. Its cost and sales information for this year follow. $ 30 per unit $ 50 per unit $ 30 per unit Direct materials Direct labor Variable overhead Fixed overhead Variable selling and administrative expenses Fixed selling and administrative expenses Units produced Units sold Sales price $ 7,700,000 per year $ 11 per unit 1. Prepare an income statement for the year using variable costing. 2. Prepare an income statement for the year using absorption costing. Required 1 Required 2 $4,750,000 per year 110,000 units 80,000 units $360 per unit Complete this question by entering your answers in the tabs below. Prepare an income statement for the year using variable costing. SIMS COMPANY

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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Concept explainers

Pricing

Pricing is used as a term in finance and economics, pricing is the process of fixing a value for a product or a service. Pricing establishes a value for a product or service that the customer has to pay. A business can choose from different strategies while deciding to set prices.

Question

Sims Company began operations on January 1. Its cost and sales information for this year follow.
$ 30 per unit
$ 50 per unit
$ 30 per unit
Direct materials
Direct labor
Variable overhead
Fixed overhead
Variable selling and administrative expenses
Fixed selling and administrative expenses
Units produced
Units sold
Sales price
$ 7,700,000 per year
$ 11 per unit
1. Prepare an income statement for the year using variable costing.
2. Prepare an income statement for the year using absorption costing.
Required 1 Required 2
$4,750,000 per year
110,000 units
80,000 units
$360 per unit
Complete this question by entering your answers in the tabs below.
Prepare an income statement for the year using variable costing.
SIMS COMPANY

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Step 1: Introduce to income statement

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Step 2: Working for sales revenue

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Step 3: Working for selling and administrative expenses

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Step 4: Working for cost of goods sold under absorption costing

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Step 5: Working for cost of goods sold under variable costing

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