Finch Manufacturing pays its production managers a bonus based on the company's profitability. During the two most recent years, the company maintained the same cost structure to manufacture its products. Units Produced Year Units Sold Production and Sales 2018 4,000 6,800 4,000 4,000 2019 Cost Data Direct materials 14.5 per unit $ 22.8 per unit $ 11.2 per unit $101,400 Direct labor Manufacturing overheadvariable Manufacturing overheadfixed Variable selling and administrative $7.2 per unit sold expenses Fixed selling and administrative expenses 56,090 (Assume that selling and administrative expenses are associated with goods sold.) Levine sells its products for $108.2 per unit. Required a. Prepare income statements based on absorption costing for 2018 and 2019. b. Since Levine sold the same number of units in 2018 and 2019, why did net income increase in 2019? d. Determine the costs of ending inventory for 2019. e. Prepare income statements based on variable costing for 2018 and 2019. Complete this question by entering your answers in the tabs below. Req A 2018 Req A 2019 Req B Req D Req E 2018 Req E 2019 Prepare income statements based on variable costing for 2019. (Do not round intermediate calculations.) FINCH MANUFACTURING Req A 2018 Req A 2019ReqB Req DReq E 2018 Req E 2019 Prepare income statements based on absorption costing for 2018. (Do not round interm FINCH MANUFACTURING Absorption Costing Income Statement For the Year Ended Dec. 31, 2018 Revenues Cost of Goods Sold: Direct materials Direct labor Manufacturing overhead 0 Gross margin Selling and administrative expenses 0 Net income Req A 2018Req A 2019 Req B Req D Req E 2018 Req E 2019 Prepare income statements based on absorption costing for 2019. (Do not round intermed FINCH MANUFACTURING Absorption Costing Income Statement For the Year Ended Dec. 31, 2019 Revenues Cost of Goods Sold: Direct materials Direct labor Manufacturing overhead 0 Gross margin 0 Selling and administrative expenses Net income 0 Complete this question by entering your answers in the tabs below. Req A 2018 Req A 2019Req B Req D Req E 2018 Req E 2019 Since Levine sold the same number of units in 2018 and 2019, why did net income increase in 2019? did net income increase in 2019? ecrease in fixed manufacturing cost Req A 2019 Req D > Complete this question by entering your answers in the tabs below. Req A 2018 Req A 2019 ReqB Req D Req E 2018 Req E 2019 Determine the costs of ending inventory for 2019. (Do not round intermediate calculations.) Ending inventory Req B Req E 2018 Prepare income statements based on variable costing for 2018. (Do not round intermediate calculations.) FINCH MANUFACTURING Variable Costing Income Statement For the Year Ended Dec. 31, 2018 Revenues Cost of Goods Sold: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Contribution margin 0 Fixed selling and administrative expenses Fixed selling and administrative expenses Net income 0 Prepare income statements based on variable costing for 2019. (Do not round intermediate calculations.) FINCH MANUFACTURING Variable Costing Income Statement For the Year Ended Dec. 31, 2019 Revenues Cost of Goods Sold: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative expenses Contribution margin Fixed manufacturing overhead ixed selling and administrative expenses et income
