E$6\mathrm{.}17$ AdditionalQuestion

Siren Company bulids custom fishing lures for sporting goods stores. In its firstyear of

operations, $2022,$ the company incurred the following costs.

UnitVariablecosis

Directmaterials

Directlabor

Variable manufacturing overhead

Variable selling and administrative expenses

$ $,7\mathrm{.}50$

$3\mathrm{.}45$

$5\mathrm{.}80$

$3\mathrm{.}90$

AnnualFxedcests

Fixed manufacturing overhead

$$225,000$

Fixed selling and administrative expenses

$210,100$

Siren Company sells the fishing lures for $$25.$ During $2022,$ the company sold $80,000$ lures and

produced $90,000$ lures.

Instructions

a$.$ Assuming the company uses variable costing, calculate Siren's

manufacturing costper unitfor $2022.$

b$.$ Prepare a variable costing income statementfor $2022.$

c$.$ Assuming the company uses absorption costing, calculate Siren's

manufacturing costper unitior $2022.$

d$.$ Prepare an absorption costing income statementior $2022.$

NOTE: Enter a formula, a cell reference, or a value $($If you are unable to reference a cell$),$ into

the yellow shaded input cells.

Additional Question

Assume thatvariable overhead costs changed to $$6\mathrm{.}10$ per unitand total fixed

manufacturing overhead increased to $$275,000.$ What is the impactof these changes on

the unitproductcosts and netincome under variable and absorption costing.

a$.$ UnitCost$($Variablecosstina$)$

Directmaterials

Directlabor

Variable manufacturing overhead

Manufacturing costper unit

b$.$

SIREN COMPANY

Income Statement

For the Year Ended December $31,2022$

Variable Cosing