Absorption and Variable Costing Income Statements

During the first month of operations ended July 31, YoSan Inc. manufactured 9,900 flat panel televisions, of which 9,200 were sold. Operating data for the month are summarized as follows:

Sales		$1,334,000
Manufacturing costs:
Direct materials	$673,200
Direct labor	198,000
Variable manufacturing cost	168,300
Fixed manufacturing cost	89,100	1,128,600
Selling and administrative expenses:
Variable	$110,400
Fixed	50,800	161,200

Required:

1. Prepare an income statement based on the absorption costing concept.

YoSan Inc.
Absorption Costing Income Statement
For the Month Ended July 31
Sales		$
Cost of goods sold:
Cost of goods manufactured	$
Inventory, July 31
Total cost of goods sold
Gross profit		$
Selling and administrative expenses
Income from operations		$

2. Prepare an income statement based on the variable costing concept.

YoSan Inc.
Variable Costing Income Statement
For the Month Ended July 31
Sales		$
Variable cost of goods sold:
Variable cost of goods manufactured	$
Inventory, July 31
Total variable cost of goods sold
Manufacturing margin		$
Variable selling and administrative expenses
Contribution margin		$
Fixed costs:
Fixed manufacturing costs	$
Fixed selling and administrative expenses
Total fixed costs
Income from operations		$

Salespersons' Report and Analysis

Walthman Industries Inc. employs seven salespersons to sell and distribute its product throughout the state. Data taken from reports received from the salespersons during the year ended December 31 are as follows:

Salesperson	Total Sales		Variable Cost of Goods Sold			Variable Selling Expenses
Case	$603,000		$241,200			$132,660
Dix	505,000		161,600			111,100
Johnson	488,000		185,440			73,200
LaFave	523,000		271,960			73,220
Orcas	591,000		200,940			82,740
Sussman	384,000		218,880			76,800
Willbond	544,000		184,960			92,480

Required:

1. Prepare a table indicating contribution margin, variable cost of goods sold as a percent of sales, variable selling expenses as a percent of sales, and contribution margin ratio by salesperson. Round percents to the nearest whole number. Enter all amounts as positive numbers.

Waltham Industries Inc.
Salespersons' Analysis
For the Year Ended December 31
Salesperson	Contribution Margin	Variable Cost of Goods Sold as a Percent of Sales	Variable Selling Expenses as a Percent of Sales	Contribution Margin Ratio
Case	$	%	%	%
Dix		%	%	%
Johnson		%	%	%
LaFave		%	%	%
Orcas		%	%	%
Sussman		%	%	%
Willbond		%	%	%