1. Prepare an income statement for the current year under variable costing. KENZ KAYAKING Variable Costing Income Statement Sales $840,000 ess: Variable costs Variable product costs Variable selling and administrative expenses Total variable costs Contribution margin Less: Fixed expenses 445,000 Fixed selling and administrative costs Fixed overhead costs 155000 105,000 Total fixed expenses Net income (loss) 260,000 S185,000 Sales $840,000 Less: Variable costs Variable product costs Variable selling and administrative expenses otal variable costs Contribution margin 445,000 ess: Fixed expenses Fixed selling and administrative costs Fixed overhead costs 155,000 105,000 Total fixed expenses Net income (loss) 260,000 185,000 Net income under absorption costing is higher than net income under variable costing by Fixed costs added to inventory $ 840,000 ess: Variable costs Variable product costs Variable selling and administrative expenses Total variable costs Contribution margin Less: Fixed expenses 445,000 Fixed selling and administrative costs Fixed overhead costs 155,000 105,000 Total fixed expenses Net income (loss) 260,000 185,000 Net income under absorption costing is higher than net income under variable costing by Number of units added to(subtracted from) inventory Fixed overhead cost per unit Fixed costs added to inventory 4.132,541.352 4,134.313: 1 of 1 le Sales Contribution margin Gross margin Net income Net loss Fixed selling and administrative costs Fixed overhead costs Total fixed expenses Net income (loss) Net income under absorption costing is higher than net income under variable Number of units added to(subtracted from) inventory Fixed overhead cost per unit Fixed costs added to inventory KENZI KAYAKING Variable Costing Income Statement Sales S 840,000 Gross margin Net income Net loss Sales Selling general and administrative expenses 445,000 Fixed selling and administrative costs Fixed overhead costs 155,000 105,000 Total fixed expenses Net income (loss) 260,000 $ 185,000 Net income under absorption costing is higher than net income under variable costing by Number of units added to(subtracted from) inventory Fixed overhead cost per unit 4.132,541,352 4.134,313 Kenzi Kayaking, a manufacturer of kayaks, began operations this year. During this first year, the company sold 800. at a price of $1,050 each. absorption costing At this first year-end, the company reported the following income statement information using Sales (880 x $1,0se) Cost of goods sold (800 x $475) Gross margin Selling and administrative expenses Net income $ 840,000 380,000 460,000 250,000 $ 210,000 Additional Information a. Product cost per kayak totals $475, which consists of $375 in variable production cost and $100 in fixed production cost-the latter amount is based on $105.000 of fixed production costs allocated to the 1,050 kayaks produced b. The $250,000 in selling and administrative expense consists of $95,000 that is variable and $155,000 that is fixed. Required 1. Prepare an income statement for the current year under variable costing. KENZI KAYAKING 1 of 1 Nex Net income $ 210,000 Additional Information a. Product cost per kayak totals $475, which consists of $375 in variable production cost and $100 in fixed production cost- the latter amount is based on $105,000 of fixed production costs allocated to the 1,050 kayaks produced. b. The $250,000 in selling and administrative expense consists of $95,000 that is variable and $155,000 that is fixed Required 1. Prepare an income statement for the current year under variable costing. KENZI KAYAKING Variable Costing Income Statement Salac Prav 1, of 1 Next