Exit Submit 58 Tim's Tools, a manufacturer of cordless drills, began operations this year. During this year, the company produced 20,000 units and sold 18,000 units. At year-end, the company reported the following income statement using absorption costing: Sales (18,000 x $30) Cost of goods sold (18,000 x $14) Gross margin Selling and administrative expenses Net income $540,000 252,000 $288,000 90,000 $198,000 Production costs per unit total $14, which consists of $12.90 in variable production costs and $1.10 in fixed production costs (based on the 20,000 units produced). 60% of total selling and administrative expenses are variable. Compute net income under variable costing Multiple Choice Prev 37 of 50 Next > Chapters 17-20 (40 points) vi 8:42 Saved Help Save & Exit Submit Fields Cutlery, a manufacturer of gourmet knife sets, produced 20,000 sets and sold 23,000 units during the current year Beginning inventory under absorption costing consisted of 3,000 units valued at $66,000 (Direct materials $12 per unit, Direct labor, $3 per unit; Variable Overhead, $2 per unit, and Fixed overhead, $5 per unit.) All manufacturing costs have remained constant over the 2-year period. At year-end, the company reported the following income statement using absorption costing Sales (23,000 x $45) Cost of goods sold (23,000 x $22) Gross margin Selling and administrative expenses Net income $1,035,000 506,000 $ 529,000 115,000 $ 414,000 60% of total selling and administrative expenses are variable. Compute net income under variable costing Multiple Choice T4WM