$1,134,000 Tanto creation, Ine. Income Statement For the Quarter oded March 1 Sales (28,350 units) Variable expenses Variable cost of goods sold $ 433, 755 Variable selling and administrativo 195.615 Contribution margin Fixed expenses! Fixed manufacturing overhead 300,150 Pixed selling and administrative 226, 980 Net operating loss 629,370 504,630 527, 130 $ 22,500) 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: 33,350 28,350 Units produced Units sold Variable conta per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative $ 7.20 $ 6.50 $ 1.60 $ 6.90 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 (oss) 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 33,350 units but sold 38,350 units. (Assume no change in total fixed costs.) a. What is the company's variable costing net operating income (loss) 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. Reg 1A Reg 1B Reg 10 Req 3A Req 3B Req 30 Compute the unit product cost under absorption costing. (Round your answer to 2 decimal places.) Unit product cos! $ 24.80 Req 1B > Reg 1A Req 1B Reg 10 Reg BA Reg 38 Reg 30 What is the company's absorption costing net operating Income (loss) for the quarter? (Round your Intermediate ca to 2 decimal places Tami's Creations, Inc. Absorption Costing Income Statement Not operating Income (loss) Reg 1A Reg 1B Req 1C Reg 3A Reg 3B Reg 30 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 (oss) Absorption costing net operating income (loss) Reg 1A Reg 1B Req 1C Reg 3A Reg 38 Req 30 During the second quarter of operations, the company again produced 33,350 units but sold 38,350 units. (Assume no change In total fixed costs. 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 foss) Absorption costing net operating income (loss)
