Winters Company uses a standard cost system. During January, the company reporte

Question

Winters Company uses a standard cost system. During January, the company reported the following manufacturing variances.

In addition, 9,010 units of product were sold at $9.00 per unit. Each unit sold had a standard cost of $6.00. Selling and administrative expenses were $6,200 for the month.

Prepare an income statement for management for the month ended January 31, 2011. (List amounts from largest positive to smallest positive followed by most negative to least negative, e.g. 15, 14, 10, -17, -5, -1. For favorable variance use either a negative sign preceding the number, e.g. -45 or parenthesis, e.g. (45). Enter all other amounts as positive amounts and subtract where necessary.)

For the Month Ended January 31, 2011

$

Materials price variance $1,490 U Labor quantity variance $ 730 U Materials quantity variance 780 F Overhead variance 880 U Labor price variance 590 U

Explanation / Answer

INCOME STATEMENT

For the month ended jan 31, 2011

Prticulars

$

$

WINTERS COMPANY

INCOME STATEMENT

For the month ended jan 31, 2011

Prticulars

$

$

Sales (9,010 units x $9) 81,090 Cost of goods sold (9010 x $6) 54,060 Gross profit (at standard) 27,030 Variances: Material price variance 1,490 Overhead variance 880 Labor quantity variance 730 Labor price variance 590 Material quantity variance -780 Total variance 2,910 Gross profit (actual) 24,120 Selling and administrative expenses 6,200 Net income 17,920

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