During 2022, Waterway Corp. produced 39,040 units and sold 39,040 for $16.00 per unit. Variable manufacturing costs were $4.00 per unit. Annual fixed manufacturing overhead was $78,080 ($2.00 per unit). Variable selling and administrative costs were $2.00 per unit sold, and fixed selling and administrative expenses were $19,520. Suppose the accountant for Waterway Corp. uses normal-absorption costing and uses the budgeted volume of 48,800 units to allocate the fixed overhead rather than the actual production volume of 39,040 units. The company expenses production volume variance to cost of goods sold in the accounting period in which it occurs.

(a) Your answer is correct Calculate the manufacturing cost per unit. (Round answer to 2 decimal places, eg. 5.25.) Manufacturing cost $ 5.60 per unit Attempts: 1 of 2 used Prepare a normal-absorption costing income statement for the first year of operation. WaterwayCorp. Income Statement-Normal-Absorption Costing For the Year Ended December 31, 2022 Sales 624640 Cost of goods sold Beginning inventory $ 0 Add Costs of goods manufactured 218624 Cost of goods sold 218624 i Add Volume variance Gross margin 1.1. Less V Selling and administrative expenses 97600 Operating income