Beta Inc. gives you the following data. Costs incurred on a per unit basis (Variable) Direct material and direct labor cost per unit $10 Sales commission per unit $3 Costs incurred that remain constant for the year (Fixed) Manufacturing $150,000 SG&A $100,000 Beta Inc. had no beginning inventories in year 1. It produced 25,000 units and sold 20,000 units during the year. The selling price per unit was $ 30. In year 2, Beta Inc. started with an inventory of 5,000 units, produced 25,000 units and sold 30,000 units at $30 each. Beta is a US based company and follows US GAAP.

Year 1 Year 2 Physical Inventory (in units) units units Opening finished goods inventory Production Sales Closing finished goods inventory Cost of goods manufactured (in $) (WIP Equation) Total Total $ Opening WIP Add: Manufacturing Costs Variable manufacturing costs Fixed manufacturing costs Less: Closing WIP Cost of goods manufactured Cost of goods sold (in $) (Finished goods Equation) Total Total $ Opening finished goods inventory Add: Cost of Good manufactured Less: Closing finished goods inventory Cost of goods sold Traditional Income Statement (in $) Total Total S Sales Cost of goods sold Gross Margin Selling , general and adminsitrative (SG&A) expenses Variable Fixed Total SG&A Operating Income