Perez Manufacturing Company makes a product that sells for $74.40 per unit. Manu

Question

Perez Manufacturing Company makes a product that sells for $74.40 per unit. Manufacturing costs for the product amount to $26.00 per unit variable, and $94,000 fixed. During the current accounting period, Perez made 4,700 units of the product and sold 4,400 units. Selling and administrative expenses were zero.

Required

a.     Prepare an absorption costing income statement.

b.     Prepare a variable costing income statement.

PEREZ MANUFACTURING COMPANY

Absorption Costing Income Statement

PEREZ MANUFACTURING COMPANY

Variable Costing Income Statement

PEREZ MANUFACTURING COMPANY

Absorption Costing Income Statement

PEREZ MANUFACTURING COMPANY

Variable Costing Income Statement

Explanation / Answer

a.     Prepare an absorption costing income statement.

b.     Prepare a variable costing income statement.

Sales (4400*74.40) 327360 Variable cost of goods sold (4400*26) (114400) Fixed cost of goods sold (94000/4700)*4400 (88000) Operating income 124960

Related Questions

Navigate

• Browse (All)
• Browse P
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.