Question
Cool Sky reports the following for its first year of operations. The company produced 42,000 units and sold 34,000 units at a price of $140
Cool Sky reports the following for its first year of operations. The company produced 42,000 units and sold 34,000 units at a price of $140 per unit.
Direct materials | $ 60 | per unit |
---|---|---|
Direct labor | $ 22 | per unit |
Variable overhead | $ 8 | per unit |
Fixed overhead | $ 504,000 | per year |
Variable selling and administrative expenses | $ 11 | per unit |
Fixed selling and administrative expenses | $ 110,000 | per year |
1a. Assume the company uses absorption costing. Determine its total product cost per unit.
1b. Assume the company uses absorption costing. Prepare its income statement for the year under absorption costing. 2a. Assume the company uses variable costing. Determine its total product cost per unit. 2b. Assume the company uses variable costing. Prepare its income statement for the year under variable costing.
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