Wei Nan Company manufactures and sells personal organizers. The following are the operating data for thecompany for 2021 and 2022:20212022Units produced60,00050,000Units sold54,00054,000Selling price per unitVariable costs per unit$250$250Direct materials$80$80Direct labour4040Variable overhead3535Selling expensesFixed manufacturing overheadFixed selling and administrative expenses3030$2,500,000 S2,500,000$300,000$ 300,000There was no beginning inventory on January 1, 2021. The company used the FIFO method to calculate the cost ofinventories. Ignore income taxes.Instructionsa. Prepare income statements for 2021 and 2022 using the absorption-costing method.b. Prepare income statements for 2021 and 2022 using the variable-costing method.c. Reconcile the absorption-costing and variable-costing net income figures for 2021 and 2022.d. Prepare income statements for 2021 and 2022 using the throughput-costing method.e. Reconcile the throughput-costing and variable-costing net income figures for 2021 and 2022.

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Wei Nan Company manufactures and sells personal organizers. The following are the operating data for the company for 2021 and 2022: 2021 2022 Units produced Units sold 60,000 50,000 54,000 54,000 Selling price per unit Variable costs per unit $250 $250 Direct materials $80 $80 Direct labour 40 40 Variable overhead 35 35 Selling expenses Fixed manufacturing overhead Fixed selling and administrative expenses 30 30 $2,500,000 S2,500,000 $ 300,000 $ 300,000 There was no beginning inventory on January 1, 2021. The company used the FIFO method to caleulate the cost of inventories. Ignore income taxes. Instructions a. Prepare income statements for 2021 and 2022 using the absorption-costing method. b. Prepare income statements for 2021 and 2022 using the variable-costing method. c. Reconcile the absorption-costing and variable-costing net income figures for 2021 and 2022.

Wei Nan Company manufactures and sells personal organizers. The following are the operating data for the company for 2021 and 2022: 2021 2022 Units produced Units sold 60,000 50,000 54,000 54,000 Selling price per unit Variable costs per unit $250 $250 Direct materials $80 $80 Direct labour 40 40 Variable overhead 35 35 Selling expenses Fixed manufacturing overhead Fixed selling and administrative expenses 30 30 $2,500,000 S2,500,000 $ 300,000 $ 300,000 There was no beginning inventory on January 1, 2021. The company used the FIFO method to caleulate the cost of inventories. Ignore income taxes. Instructions a. Prepare income statements for 2021 and 2022 using the absorption-costing method. b. Prepare income statements for 2021 and 2022 using the variable-costing method. c. Reconcile the absorption-costing and variable-costing net income figures for 2021 and 2022.

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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