Absorption Costing Income Statement

On June 30, the end of the first month of operations, Tudor Manufacturing Co. prepared the following income statement, based on the variable costing concept:

Sales (90,000 units)				$1,170,000
Variable cost of goods sold:
	Variable cost of goods manufactured (110,000 units x $9 per unit)	$990,000
	Less ending inventory (20,000 units x $9 per unit)	180,000
	Variable cost of goods sold			810,000
Manufacturing margin				$360,000
Variable selling and administrative expenses				12,000
Contribution margin				$348,000
Fixed costs:
	Fixed manufacturing costs	$44,000
	Fixed selling and administrative expenses	22,000		66,000
Income from operations				$282,000

a. Prepare an absorption costing income statement. In your computations, round unit costs to two decimal places and round final answers to the nearest dollar.

Tudor Manufacturing Co.
Income Statement-Absorption Costing
For the Month Ended June 30
Sales		$fill in the blank 0d6b44ffa00cfae_2
Cost of goods sold:
Cost of goods manufactured	$fill in the blank 0d6b44ffa00cfae_4
Less ending inventory	fill in the blank 0d6b44ffa00cfae_6
Cost of goods sold		fill in the blank 0d6b44ffa00cfae_8
Gross profit		$fill in the blank 0d6b44ffa00cfae_10
Selling and administrative expenses		fill in the blank 0d6b44ffa00cfae_12
Income from operations		$fill in the blank 0d6b44ffa00cfae_13

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b. Reconcile the variable costing income from operations of $282,000 with the absorption costing income from operations determined in (a).

Reconciliation of Variable and Absorption Costing Income
Variable costing income from operations	$fill in the blank faa086f43030073_1
Absorption costing income from operations	fill in the blank faa086f43030073_2
Difference	$fill in the blank faa086f43030073_3