Exercise 7-6 (Algo) Variable and Absorption Costing Unit Product Costs and Income Statements [LO7-1. LO7-2] $.4 $ 2 Lynch Company manufactures and sells a single product. The following costs were incurred during the company's first year of operations: Variable costs per unit: Manufacturing: Direct materials $ 10 Direct labor Variable manufacturing overhead Variable selling and administrative $ 2 Pixed costs per year Fixed manufacturing overhead $ 374,000 Fixed selling and administrative $ 284,000 During the year, the company produced 34.000 units and sold 26,000 units. The selling price of the company's product is $44 per unit. Required: 1. Assume that the company uses absorption costing: a. Compute the unit product cost. b. Prepare an income statement for the year. 2. Assume that the company uses variable costing a. Compute the unit product cost. b. Prepare an income statement for the year. 25 Complete this question by entering your answers in the tabs below. Reg 1A Reg 10 Reg 2A Reg 28 Compute the unit product cost. Assume that the company uses absorption costing, Unit product cont During the year, the company produced 34,000 units and sold 26,000 units. The selling price of the com Required: 1. Assume that the company uses absorption costing: a. Compute the unit product cost. b. Prepare an income statement for the year. 2. Assume that the company uses variable costing: a. Compute the unit product cost. b. Prepare an income statement for the year. Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 2A Req 2B Prepare an income statement for the year. Assume that the company uses absorption costing. Lynch Company Absorption Costing Income Statement ces 0 $ 0 Required: 1. Assume that the company uses absorption costing: a. Compute the unit product cost. b. Prepare an income statement for the year. 2. Assume that the company uses variable costing: a. Compute the unit product cost. b. Prepare an income statement for the year. k hit Complete this question by entering your answers in the tabs below. nt Req 1A Req 1B Req 2A Reg 2B ences Compute the unit product cost. Assume that the company uses variable costing. Unit product cost year. Complete this question by entering your answers in the tabs below. is kipped Req 1A Req 1B Req 2A Req 2B Prepare an income statement for the year. Assume that the company uses variable costing. eBook Lynch Company Variable Costing Income Statement Hint Print 0 ferences 0 0 $ 0 340 $ 40 $ 30 Variable manufacturing overhead Variable selling and administrative Fixed costs: Fixed manufacturing overhead $ 56,000 Fixed selling and administrative $ 24,000 The absorption costing income statement prepared by the company's accountant for last year appears below: Sales $ 178,200 Cost of goods sold 140,400 Gross margin 37,800 Selling and administrative expense 29,400 Net operating income $ 8,400 Required: 1. Under absorption costing, how much fixed manufacturing overhead cost is included in the company's inventory at the ena year? 2. Prepare an income statement for last year using variable costing. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Under absorption costing, how much fixed manufacturing overhead cost is included in the company's inventory at the end of last year? Fixed manufacturing overhead cost included in inventory Romiradi Required 2 > 2. Prepare an income Statement of last year usiliy varidule CUSLIY. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare an income statement for last year using variable costing. Ida Company Variable Costing Income Statement 0 0 ncos 0 $ 0 (Algo) Variable and Absorption Costing Unit Product Costs (L07-1] Ida Company produces a handcrafted musical instrument called a gamelan that is similar to a xylophone. The gamelans $891. Selected data for the company's operations last year follow: Units in beginning inventory Units produced 24,000 Units sold 22,000 Units in ending inventory 2,000 Variable costs per unit: Direct materials $ 150 Direct labor $ 510 Variable manufactuting overhead $ 63 Variable selling and administrative $ 23 Fixed costs: Pixed manufacturing overhead $ 680,000 Fixed selling and administrative $ 530,000 Required: 1. Assume that the company uses absorption costing. Compute the unit product cost for one gamelan. (Round your interme calculations and final answer to the nearest whole dollar amount.) 2. Assume that the company uses variable costing. Compute the unit product cost for one gamelan. 1. Absorption costing unit product cost 2. Variable costing unit product cost