esaw11Whitman Company has just completed its first year of operations. The company's absorption costing income statement for the yearfollows:f₂Sales (40,000 units x $42.60 per unit)Cost of goods sold (40,000 units x $22 per unit)Gross marginSelling and administrative expensesNet operating incomeDirect materialsDirect laborThe company's selling and administrative expenses consist of $300,000 per year in fixed expenses and $5 per unit sold in variableexpenses. The $22 unit product cost given above is computed as follows:Variable manufacturing overheadFixed manufacturing overhead ($230,000 + 46,000 units)Absorption costing unit product costWhitman CompanyIncome Statement,Required 1 Required 2Required:1. Redo the company's income statement in the contribution format using variable costing.2. Reconcile any difference between the net operating income on your variable costing income statement and the net operatingincome on the absorption costing income statement above.Complete this question by entering your answers in the tabs below.f3f4Redo the company's income statement in the contribution format using variable costing.Whitman CompanyVariable Costing Income Statement[]-fs$ 1,704,000880,000824,000500,000$ 324,00040f6Q Search$9445$ 224-f74+f8 90< PrevfgK1 of 1VերfioNext >fu

A Variable Costing Income Statement is a management accounting financial statement that gives a…

Whitman Company has just completed its first year of operations. The company's absorption cos follows: Whitman Company Income Statement. Sales (40,000 units x $42.60 per unit) Cost of goods sold (40,000 units x $22 per unit) Gross margin Selling and administrative expenses Net operating income Direct materials $ 1,704,000 880,000 824,000 500,000 $ 324,000 The company's selling and administrative expenses consist of $300,000 per year in fixed expense expenses. The $22 unit product cost given above is computed as follows:

Whitman Company has just completed its first year of operations. The company's absorption cos follows: Whitman Company Income Statement. Sales (40,000 units x $42.60 per unit) Cost of goods sold (40,000 units x $22 per unit) Gross margin Selling and administrative expenses Net operating income Direct materials $ 1,704,000 880,000 824,000 500,000 $ 324,000 The company's selling and administrative expenses consist of $300,000 per year in fixed expense expenses. The $22 unit product cost given above is computed as follows:

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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