Crazy Mountain Sports Inc. assembles and sells snowmobile engines. The company began operations on March 1 and operated at 100% of capacity during the first month. The following data summarize the results for March: Sales (13,500 units) Production costs (17,000 units): $1,215,000 Direct materials Direct labor Variable factory overhead Fixed factory overhead Selling and administrative expenses: Variable selling and administrative expenses Fixed selling and administrative expenses $566,100 272,000 136,000 90,100 1,064,200 $165,000 63,900 228,900 If required, round interim per-unit calculations to the nearest cent. a. Prepare an income statement according to the absorption costing concept. Crazy Mountain Sports Inc. Absorption Costing Income Statement For the Month Ended March 31 Line Item Description Amount b. Prepare an income statement according to the variable costing concept. Crazy Mountain Sports Inc. Variable Costing Income Statement For the Month Ended March 31 Line Item Description Amount Amount Fixed costs: Sales (5,600 units) Joplin Company Absorption Costing Income Statement For the Month Ended April 30 Cost of goods sold: Cost of goods manufactured (6,600 units) Inventory, April 30 (900 units) Total cost of goods sold Gross profit Selling and administrative expenses Operating income $100,800 $85,800 (11,700) (74,100) $26,700 (16,840) $9,860 If the fixed manufacturing costs were $21,450 and the fixed selling and administrative expenses were $8,250, whole dollars. Joplin Company Variable Costing Income Statement For the Month Ended April 30 Line Item Description Amount Amount Variable cost of goods sold: Fixed costs: Sales (12,900 units) Maryville Equipment Company Variable Costing Income Statement For the Month Ended October 31 Variable cost of goods sold: Variable cost of goods manufactured Inventory, October 31 (1,800 units) Total variable cost of goods sold Manufacturing margin Variable selling and administrative expenses $593,400 $264,600 (32,400) (232,200) $361,200 (154,800) $206,400 Contribution margin Fixed costs: Fixed manufacturing costs $58,800 Fixed selling and administrative expenses 38,700 Total fixed costs (97,500) Operating income $108,900 Prepare an income statement under absorption costing. Round all final answers to whole dollars. Maryville Equipment Company Absorption Costing Income Statement For the Month Ended October 31 Line Item Description Cost of goods sold: Amount Amount Fleet-of-Foot Inc. Product Income Statements-Absorption Costing For the Year Ended December 31 Cross Training Shoes Golf Shoes Running Shoes Revenues Cost of goods sold Gross profit $451,400 (234,700) $257,300 $218,700 $216,700 $131,200 (126,100) (146,500) $72,200 Selling and administrative expenses (186,400) $30,300 (94,500) (120,600) $36,700 $(48,400) Operating income In addition, you have determined the following information with respect to allocated fixed costs: Cross Training Shoes Golf Shoes Running Shoes Fixed costs: Cost of goods sold Selling and administrative expenses $72,200 54,200 $33,400 30,900 $30,600 30,600 These fixed costs are used to support all three product lines and will not change with the elimination of any one product. In addition, you have determined that the effects of inventory may be ignored. The management of the company has deemed the profit performance of the running shoe line as unacceptable. As a result, it has decided to eliminate the running shoe line. Management does not expect to be able to increase sales in the other two lines. However, as a result of eliminating the running shoe line, management expects the profits of the company to increase by $48,400. a. Are management's decision and conclusions correct? Management's decision and conclusion are The profit be improved because the fixed costs used in manufacturing and selling running shoes b. Prepare a variable costing income statement for the three products. Enter a net loss as a negative number using a minus sign. Fleet-of-Foot Inc. Variable Costing Income Statements-Three Product Lines For the Year Ended December 31 Line Item Description Cross Training Shoes Fixed costs: Total fixed costs Operating income (loss) 000000000 |0000 000000 be avoided if the line is eliminated. During the first month of operations ended July 31, YoSan Inc. manufactured 11,400 flat panel televisions, of which 10,500 were sold. Sales Manufacturing costs: $1,470,000 Direct materials $752,400 Direct labor 228,000 Variable manufacturing cost 193,800 Fixed manufacturing cost 91,200 1,265,400 Selling and administrative expenses: Variable $115,500 Fixed 53,100 168,600 Required: 1. Prepare an income statement based on the absorption costing concept. YoSan Inc. Absorption Costing Income Statement For the Month Ended July 31 Line Item Description Cost of goods sold: Amount Amount 2. Prepare an income statement based on the variable costing concept. YoSan Inc. Variable Costing Income Statement For the Month Ended July 31 Line Item Description Amount Amount Variable cost of goods sold: Fixed costs: DO 0000 00