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W E9-22 (similar to) Accelerate Motors assembles and sells motor vehicles and uses standard costing. Actual data and variable costing and absorption costing income statements relating to April and May 2017 are as follows: (Click the icon to view the data.) The variable manufacturing costs per unit of Accelerate Motors are as follows: (Click the icon to view the variable manufacturing costs per unit.) (Click the icon to view the variable costing income statements.) Read the requirements (Click the icon to view the absorption costing income statements.) Requirement 1. Prepare income statements for Accelerate Motors in April and May 2017 under throughput costing. Begin by completing the top portion of the statement, then the bottom portion. (Complete all answer boxes. Enter a "0" for any zero amounts.) April 2017 May 2017 Revenues Data Table April Unit data: Beginning inventory Production 500 Sales 400 Variable costs: Manufacturing cost per unit produced $ 9,500 $ 0,500 Operating (marketing) cost per unit sold 2.800 2,800 Fixed costs: Manufacturing costs $ 2.200.000 $ 2.200.000 Operating (marketing) costs 675,000 675,000 The selling price per vehicle is $28.000. The budgeted level of production used to calculate the budgeted fixed manufacturing cost per unit is 500 units. There are no price, efficiency, or spending variances. Any production-volume variance is written off to cost of goods sold in the month in which it occurs. Print Done 0 variable costing income statements - X April 2017 May 2017 $ 13,650,000 $ 10,400,000 Revenues Variable costs: Beginning inventory Variable manufacturing costs Cost of goods available for sale $ 4,750,000 950,000 4,275,000 5,225,000 (237.500) 4,987,500 1,470,000 4,750,000 (950.000) 3,800,000 1,120.000 Less: Ending inventory Variable cost of goods sold Variable operating costs 6,457,500 4.920,000 5.480,000 7,192,500 Total variable costs Contribution margin Fooed costs: Fixed manufacturing costs Fixed operating costs Total foed costs Operating income 2.200.000 675,000 2,200,000 675,000 2,875,000 2.605,000 2,875,000 4,317,500 $ $ Print Done i absorption costing income statements - X May 2017 April 2017 $10.400,000 $13,650,000 $ Revenues Cost of goods sold: Beginning inventory Variable manufacturing costs Allocated fixed manufacturing costs Cost of goods available for sale Less: Ending inventory 4,750,000 2,200,000 1,390,000 4,275,000 1,980,000 6,950,000 (1,390,000) 7,645,000 (347,500) 220.000 Adjustment for production-volume variance 5,560,000 4,840,000 7,517,500 6,132,500 Cost of goods sold Gross margin Operating costs: Variable operating costs Fixed operating costs 1.120.000 675.000 1.470.000 675.000 Total operating costs 1.795.000 $ 3.045,000 2.145.000 $ 3.987.500 Operating income Print Done 0 X - Data Table May Direct material cost per unit Direct manufacturing labor cost per unit Manufacturing overhead cost per unit April 7,200 $ 1,400 900 7,200 1,400 900 Print Done W E9-22 (similar to) Question Help Race Track Motors assembles and sells motor vehicles and uses standard costing. Actual data and variable costing and absorption costing income statements relating to April and May 2017 are as follows: (Click the icon to view the data.) The variable manufacturing costs per unit of Race Track Motors are as follows: (Click the icon to view the variable manufacturing costs per unit.) FF: (Click the icon to view the variable costing income statements.) Read the requirements. (Click the icon to view the absorption costing income statements.) Requirement 1. Prepare income statements for Race Track Motors in April and May 2017 under throughput costing. Begin by completing the top portion of the statement, then the bottom portion. (Complete all answer boxes. Enter a "0" for any zero amounts.) April 2017 May 2017 Revenues $ 17.400,000 $ 19,720,000 Direct material cost of goods sold Beginning inventory $ 680,000 Direct materials 4,760,000 4.080.000 Cost of goods available for sale 4,760.000 4,780,000 Deduct ending inventory .. (680,000) (136,000) Total direct material cost of goods sold 4.080.000 4,624.000 Throughput margin 13,320,000 15,098,000 Manufacturing costs 3,990,000 3,720,000 Other operating costs 2,060,000 2.268.000 S 7,270,000 S 9,108,000 Operating income Requirement 2. Contrast the results in requirement 1 with the absorption and variable costing income statements presented. In April, throughput costing has the lowest operating income, whereas in May throughout costing has the highest operating income. Throughput costing puts greater emphasis on sales as the source of operating income than does either absorption or variable costing Requirement 3. Give one motivation for Race Track Motors to adopt throughput costing. in the period of incurrence, Throughput costing puts a penalty on production without a corresponding sale in the same period. Costs other than direct materials that are variable with respect to production are expensed whereas under variable costing they would be capitalized. As a result, throughput costing provides less incentive to produce for inventory than either absorption or variable costing