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Appliance Apps has the following costs associated with its production and sale of devices that allow appliances to receive commands from cell phones. Beginning Inventory
Appliance Apps has the following costs associated with its production and sale of devices that allow appliances to receive commands from cell phones. Beginning Inventory 0 Units Produced 25,000 Units Sold 20,000 Selling Price per Unit $145 Variable Sales and Administration Expenses $4 Fixed Sales and Administration Expenses $970,000 Direct Material Cost per Unit $25 Direct Labor Cost per Unit $11 Variable Manufacturing Overhead Cost per Unit $3 Fixed Manufacturing Overhead Cost per Month $980,000 Prepare an income statement under the absorption method. If an amount box does not require an entry, leave it blank. 2,900,000 Appliance Apps Income Statement: Absorption Sales Cost of Goods Sold: Beginning Inventory $ 1,955,000 Cost of Goods Manufactured Cost of Goods Available for Sale Ending Inventory Total Cost of Goods Sold Gross Profit Sales and Administrative Expenses: Variable Fixed Total Fixed Sales and Administrative Expenses Net Operating Income Feedback Check My Work Absorption costing includes all costs necessary for production. Conversely, variable costing only uses the variable costs that relate directly to the Prepare an income statement under the variable costing method. If an amount box does not require an entry, leave it blank. Appliance Apps Income Statement: Variable Sales Cost of Goods Sold: Beginning Inventory Cost of Goods Manufactured Cost of Goods Available for Sale Ending Inventory Total Cost of Goods Sold Gross Contribution Margin Sales and Administrative Expenses: Variable Contribution Margin Fixed Sales and Administrative Expenses Fixed Manufacturing Total Fixed Sales and Administrative Expenses Net Operating Income Feedback Prepare a reconciliation between the two statements. Reconciliation Net Income under Variable Costing Add: Fixed Manufacturing Overhead Deferred Net Income under Absorption Feedback Feedback
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