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ignment/takeAssignmentMain.do?invoker-assignmentsäitakeAssignmentSessionl ocator take8inprogress false eBook Show Me How Print item Income Statements under Absorption and Variable Costing The Duller Edge Inc assembles and sells MP3 players. The company began operations on May 1, 2016, and operated at 100% of cap act during the first month. The following data summarize the results for May: Sales (12,000 units) Production costs (15,000 units): $1,680,000 Direct materials Direct labor Variable factory overhead Fixed Tactory overhead $777,000 373,500 186,000 124,500 1,461,000 Selling and administrative expenses $226,500 Variable selling and administrative expenses Fixed selling and administrative expenses 87,700314,200 If required, round interim per-unit calculations to the nearest cent. an income statement according to the absorption costing concept. The Duller Edge Inc Absorption Costing Income Statemen For the Month Ended May 31, 2016 Previous heck My Work 4 more Check My Work uses remaining Email Instructor Save and Exit Submit Assignment for GraExplanation / Answer
a) The Duller Edge Inc.
Absorption costing Income Statement for the month ended may 31, 2016 (Amt in $)
b) The Duller Edge Inc.
Variable costing Income Statement for the month ended may 31, 2016 (Amt in $)
c) Under the Absorption costing method, the fixed overhead cost included in the cost of goods sold is matched with the revenues. Under the variable costing method, all of the fixed manufacturing cost is deducted in the period in which it is incurred, regardless of the amount of inventory change. Thus when the inventory decreases, the Variable costing income statement will have a lower income operations.
Sales 1,680,000 Production costs (1,461,000*12,000/15,000) (1,168,800) Gross Income 511,200 Selling and Administrative expenses (314,200) Net Income 197,000Related Questions
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