Tech Helpers Company prepares a variable costing income statement for internal management and an absorption costing income
Question:
Tech Helpers Company prepares a variable costing income statement for internal management and an absorption costing income statement for its bank. Tech Helpers provides a personal computer maintenance service that is sold for \($100.\) The variable and fixed cost data are as follows:
During 2015, 4,000 service contracts were started and 5,000 service contracts were completed. At the beginning of 2016, Tech Helpers had 1,000 service contracts in process at a per-unit cost of \($90\) in beginning work-in-process inventory.
Required
a. Calculate reported income for management.
b. Calculate reported income for the bank.
c. Reconcile the two income amounts.
Step by Step Answer:
Managerial Accounting For Undergraduates
ISBN: 9781618531124
1st Edition
Authors: Christensen, Theodore E. Hobson, L. Scott Wallace, James S.