Units sold Units produced Fixed production costs Variable production costs per unit Selling price per unit Fixed selling and administrative expense 2020 4,400 4,400 $39,600 $82 $215 $410,000 2021 4,400 4,800 $39,600 $82 $215 $410,000 2022 4,400 13,200 4,000 13,200 $39,600 $82 $215 Total $410,000

Units sold Units produced Fixed production costs Variable production costs per unit Selling price per unit Fixed selling and administrative expense 2020 4,400 4,400 $39,600 $82 $215 $410,000 2021 4,400 4,800 $39,600 $82 $215 $410,000 2022 4,400 13,200 4,000 13,200 $39,600 $82 $215 Total $410,000

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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Question

Calculate profit and the value of ending inventory for each year using variable costing.
Net profit
Ending inventory
$
$
2020
2021
32800
$
2022
0

Units sold
Units produced
Fixed production costs
Variable production costs per unit
Selling price per unit
Fixed selling and administrative expense
2020
4,400
4,400
$39,600
$82
$215
$410,000
2021
4,400
4,800
$39,600
$82
$215
2022
4,400
$39,600
$82
$215
Total
4,000 13,200
$410,000 $410,000
13,200

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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 variable production costs under variable costing method

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Step 4: Working for net profit under variable costing

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Step 5: Working for ending inventory using variable costing method

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