ageNOWv2 | Online t X Email - Goncalves, Leonard X Log in - WES.org X + a ngagenow.com/ilm/takeAssignment/takeAssignmentMain.do eBook Show Me How Income Statements under Absorption Costing and Variable Costing Joplin Industries Inc. manufactures and sells high-quality sporting goods equipment under its highly recognizable J-Sports logo. The company began operations on May 1 and operated at 100% of capacity (60,500 units) during the first month, creating an ending inventory of 5,500 units. During June, the company produced 55,000 garments during the month but sold 60,500 units at $90 per unit. The June manufacturing costs and selling and administrative expenses we as follows: Number of Unit Total Units Cost Cost Manufacturing costs in June 1 beginning inventory: Variable 5,500 $36.00 $198,000 Fixed 5.500 14.0 77,000 Total $50.00 $275,000 Manufacturing costs in June: Variable 55,000 $36.00 $1,980,000 Fixed 55,000 15.40 847,000 Total $51.40 $2,827,000 Selling and administrative expenses in June: Variable 50,500 18.20 $1 101,100 Fixed 60,500 7.00 423,500 Total 25.20 $1,524,600 a. Prepare an income statement according to the absorption costing concept for June. Joplin Industries Inc. Absorption Costing Income Statement For the Month Ended June 30 Sales 5 445,000 Cost of goods sold; Beginning inventory Cost of goods manufactured Total cost of goods sold Gross profit - Selling and administrative expenses Income from operations Check My Work Previous Next All work saved. Email Instructor Save and Exit Submit Assignment for GradingQ Wv2 | Online : X Email-Goncalves, Leonard X Log in - WES.org X 4 enow.com/ilm/takeAssignment/takeAssignmentMain.do eBook Show Me How a. Under absorption costing, the cost of goods manufactured includes direct materials, direct labor, and factory overhead costs. Both fixed and variable factory costs are included as part of factory overhead. Learning Objective 1. b. Prepare an income statement according to the variable costing concept for June. Joplin Industries Inc. Variable Costing Income Statement For the Month Ended June 30 Sales Variable cost of goods sold Manufacturing margin 000100 Variable selling and administrative expenses Contribution margin Fixed costs: Fixed manufacturing costs Fixed selling and administrative expenses Total fixed costs Income from operations Feedback Check My Work b. Under variable costing, the cost of goods m cludes only variable manufacturing costs. b. Under variable costing, the cost of goods manu ncludes only variable manufacturing costs Learning Objective 1 c. What is the reason for the difference in the amount of income from operations reported in (a) and (b)? Under the absorption costing - method, the fixed manufacturing cost included in the cost of goods sold is matched with the revenues, Under variable costing , all of the fixed manufacturing cost is deducted in the period in which it is incurred, regardless of the amount of inventory change. Thus, when inventory decreases, the absorption costing v income statement will have a lower income from operations. Feedback Check My Work Correct Check My Work Previous Next All work saved. Email Instructor Save and Exit Submit Assignment for Grading