Symond Corporation produces one product. Its cost includes direct materials ($11

Question

Symond Corporation produces one product. Its cost includes direct materials ($11per unit), direct labor ($7per unit), variable overhead ($6per unit), fixed manufacturing ($272,030), and fixed selling and administrative ($33,430). In October 2012, Symond produced24,730units and sold 19,033 at $50each. THE DROP DOWN MENU TITLES ARE: CONTRIBUTION MARGIN, COST OF GOODS SOLD< FIXED COSTS, GROSS PROFIT, NET INCOME, AND SALES.

Prepare an absorption costing income statement.

SYMOND CORPORATION
Income Satement
For the Month Ended October 31, 2012
(Absorption Costing)

$







$ SYMOND CORPORATION
Income Satement
For the Month Ended October 31, 2012
(Absorption Costing) $ $ Symond Corporation produces one product. Its cost includes direct materials ($11per unit), direct labor ($7per unit), variable overhead ($6per unit), fixed manufacturing ($272,030), and fixed selling and administrative ($33,430). In October 2012, Symond produced24,730units and sold 19,033 at $50each. THE DROP DOWN MENU TITLES ARE: CONTRIBUTION MARGIN, COST OF GOODS SOLD< FIXED COSTS, GROSS PROFIT, NET INCOME, AND SALES.

Explanation / Answer

Sales = 19033 * 50 = $951,650 Fixed costs = 272,030 + 33,430 = $305,480 mean inventory = 2834 Contribution margin = 951650 - 24*24,730 = $358,130 Cost of goods sold = 24*19033 + (19033/24730)*33430 = 482,521 Gross profit = sales - COGS = $469129 Net Income = gross profit - sales and administrative expense = $435699

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