B C D E F G H 1 K L M N 0 Problem 1 1 On December 31. The end of the first year of operations, Frankenreiter Inc. manufactured 25,600 units and sold 24,000 units. The following income statement was prepared, based on the variable costing concept: Frankenreiter Inc. Variable Costing Income Statement For the Year Ended December 31, 20Y1 $ 9,600,000 5,376,000 336000 Sales Variable costs of Goods Sold Variable Manufacturing costs less Ending Inventory Total Variable COGS Manufacturing Margin vode Less Variable Selling and Administrative Expenses . Contribution margin Less Fixed costs Fixed manufacturing costs Fixed Selling and Administrative expenses Total Fixed costs Income from Operation 5,040,000 4,560,000 1,150,000 3,410,000 1,664,000 890,000 2,554,000 856,000 Required: Determine the unit costs of goods manufactured (COGM), based on: A. Variable costing concept B. Absorption costing concept Siddique, Salina: Variable COGM include only variable manufacturing costs. Solution: A. Variable COGM per unit = Variable COGM/# of units produced $210.00 per unit Siddique, Salina: Under absorption costing, COGM includes both Varibale and Fixed manufacturing costs. B. Absorpton costing COGM per unit = Absorption costing COGM/# of units produced $275.00 per unit