Exercise 7-9 Variable and Absorption Costing Unit Product Costs and Income Statements (L07-1, L07-2, L07-3) Walsh Company manufactures and sells one product. The following information pertains to each of the company's first two years of operations: 25 15 . Variable costs per unite Mataturing Direct materiale Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year Fixed manufacturing overhead Fixed selling and administrative expenses . $ 250.000 $80,000 During its first year of operations, Walsh produced 50,000 units and sold 40,000 units. During its second year of operations, it produced 40,000 units and sold 50,000 units. The selling price of the company's product is $60 per unit. Required: 1. Assume the company uses variable costing a. Compute the unit product cost for Year 1 and Year 2 b. Prepare an income statement for Year 1 and Year 2 2. Assume the company uses absorption costing Compute the unit product cost for Year 1 and Year 2 b. Prepare an income statement for Year 1 and Year 2 Exercise 7-9 Variable and Absorption Costing Unit Product Costs and Income Statements (LO7-1, L07-2, L07-3) Walsh Company manufactures and sells one product. The following information pertains to each of the company's first two years of operations Variable costs per unit Manufacturing Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year Fixed manufacturing overhead Fixed selling and administrative expenses 5 $ 5 25 15 5 2 $ 250.000 During its first year of operations, Walsh produced 50.000 units and sold 40,000 units. During its second year of operations, it produced 40.000 units and sold 50,000 units. The selling price of the company's product is $60 per unit Required: 1. Assume the company uses variable costing a. Compute the unit product cost for Yeart and Year 2 b. Prepare an income statement for Year 1 and Year 2 2. Assume the company uses absorption costing: a. Compute the unit product cost for Year 1 and Year 2 During its first year of operations, Walsh produced 50,000 units and sold 40,000 units. During its second year of operation produced 40,000 units and sold 50,000 units. The selling price of the company's product is $60 per unit. Required: 1. Assume the company uses variable costing: a. Compute the unit product cost for Year 1 and Year 2 b. Prepare an income statement for Year 1 and Year 2. 2. Assume the company uses absorption costing: a. Compute the unit product cost for Year 1 and Year 2. b. Prepare an income statement for Year 1 and Year 2. 3. Reconcile the difference between variable costing and absorption coking net operating income in Year 1. Complete this question by entering your answers in the tabs below. Reg 1A Req 18 Reg 2A Reg 28 Req 3 Assume the company uses variable costing. Compute the unit product cost for Year 1 and Year 2. Year 1 Year 2 Unit product cost HATA Reg 18 Req 1A Req 1B Req 2A Req 2B Req3 Assume the company uses variable costing. Prepare an income statement for Year 1 and Walsh Company Income Statement Year 1 Year 2 0 0 0 0 0 0 Net operating income (loss) $ 0 $ 0 repare an come statement Tea anu Teat. 2. Assume the company uses absorption costing: a. Compute the unit product cost for Year 1 and Year 2. b. Prepare an income statement for Year 1 and Year 2. 3. Reconcile the difference between variable costing and absorption costing net operating ince Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 2A Req 2B Reg 3 Assume the company uses absorption costing. Compute the unit product cost for Year 1 and Year 2 calculations and final answers to 2 decimal places.) Year 1 Year 2 Unit product cost U. PHILIR DEL TUITI I GIU 2. 2. Assume the company uses absorption costing: a. Compute the unit product cost for Year 1 and Year 2 b. Prepare an income statement for Year 1 and Year 2 3. Reconcile the difference between variable costing and absorption costing net operating income in Year 1. Complete this question by entering your answers in the tabs below. Reg 1A Req 18 Reg 2A Reg 28 Reg 3 Assume the company uses absorption costing. Prepare an income statement for Year 1 and Year 2. (Round your inte calculations to 2 decimal places.) Walsh Company Income Statement Year 1 Year 2 Net operating income (loss) $ 0 $ 0 Une Sana anu real 2. 2. Assume the company uses absorption costing: a. Compute the unit product cost for Year 1 and Year 2. b. Prepare an income statement for Year 1 and Year 2. 3. Reconcile the difference between variable costing and absorption costing net operating income in Year 1. Complete this question by entering your answers in the tabs below. Reg 1A Reg 1B Req 2A Reg 2B Req3 Reconcile the difference between variable costing and absorption costing net operating Income In Year 1. (Enter a deductions as a negative value.) Year 1 Year 2 Variable costing net operating income (loss) Absorption costing net operating income