1. Complete the following:
a. Compute the unit product cost under absorption costing.
b. What is the companys absorption costing net operating income (loss) for the quarter?
c. Reconcile the variable and absorption costing net operating income (loss) figures.
3. During the second quarter of operations, the company again produced 31,500 units but sold 34,500 units. (Assume no change in total fixed costs.)
a. What is the companys variable costing net operating income (loss) for the second quarter?
b. What is the companys absorption costing net operating income (loss) for the second quarter?
c. Reconcile the variable costing and absorption costing net operating incomes for the second quarter.
Tam Tyler opened Tom Cretions, Inc. a small manufacturing company at the beginning of the year Getting the company to u r of tons placed a considerable r on Ms. Tyler's personal finances. The following income statement for the first quarter was prepared by a friend who has just completed a course in managerial accounting at State University, Tania Creations, Inc. Income Statement Tor the Quarter Ended March 31 sales (28,500 units) $1,140,000 Variable expenses Variable cost of goods $498,750 sold Variable selling and administrative 193,800 692,550 Contribution margin 467.650 Fixed expenses Tixed manufacturing overhead 283,500 Fixed selling and 460,950 administrative 177.450 Het operating loss $ 13.500) Ms. Tyler is discouraged over the loss shown for the quarter particularly because she had planned to use the statement as support for a bank loan. Another friend, a CPA, insists that the company should be using absorption costing rather than variable costing and argues that if absorption costing had been used the company probably would have reported at least some profit for the quarter At this point, Ms. Tyler is manufacturing only one product-a swimsuit Production and cost data relating to the swimsuit for the first quarter follow 31,500 20,500 Units produced Units sold Variable costa per units Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative $7.50 $8.00 $2.00 $6.80 Required: 1. Complete the following: a Compute the unit product cost under absorption costing b. What is the company's absorption costing net operating income loss for the quarter? c. Reconcile the variable and absorption costing net operating income fossures 3. During the second quarter of operations, the company again produced 31500 units but sold 34.500 units. (Assume no change in total fixed costs) a. What is the company's variable costing net operating Income poss) for the second quarter? b. What is the company's absorption costing net operating income oss) for the second quarter? c. Reconcile the variable costing and absorption costing net operating incomes for the second quarter Complete this question by entering your answers in the tabs below. Req 1A Req 18 Reg 1C Reg 3A Reg 33 Reg 3C Compute the unit product cost under absorption costing. (Round your answer to 2 decimal places.) Unit product Reg 1A Req 1B Req 1C Req 3A Req 3B Req 30 What is the company's absorption costing net operating income (loss) for the quarter? (Round your intermediate calculations to 2 decimal places.) Tami's Creations, Inc. Absorption Costing Income Statement Total Net operating income (loss) Reg 1A Req 1B Req 1C Reg Req 3B Reg 3C Reconcile the variable and absorption costing net operating income (loss) figures. (Losses and deductions should be entered as a negative.) Reconciliation of Variable Costing and Absorption Costing Net Operating Incomes Variable costing net operating income (loss) Absorption costing net operating income (loss) Req 1A Req 1B Req 10 Req 3A Req 38 Req 3C During the second quarter of operations, the company again produced 31,500 units but sold 34,500 units. What is the company's variable costing net operating income (loss) for the second quarter? Tami's Creations, Inc. Variable Costing Income Statement Net operating income (loss) Reg 10 Reg 33 > Reg 1A Reg 1B Reg 10 Req Req 3B Req 3C During the second quarter of operations, the company again produced 31,500 units but sold 34,500 units. What is the company's absorption costing net operating income (loss) for the second quarter? (Round your intermediate calculations to 2 decimal places.) Tami's Creations, Inc. Absorption Costing Income Statement Total Net operating income (loss) Reg 1A Reg 1B Req 1C Req Req 3B Req 3C During the second quarter of operations, the company again produced 31,500 units but sold 34,500 units. Reconcile the variable costing and absorption costing net operating incomes (losses) for the second quarter. (Losses and deductions should be entered as a negative.) Reconciliation of Variable Costing and Absorption Costing Net Operating Incomes Variable costing net operating income (loss) Absorption costing net operating income (loss)
