For example, in cell B26 enter the formula "= B17". After entering formulas in all of the cells that contained question marks, verify that the dollar amounts match the numbers in Review Problem 1. The LIFO inventory flow assumption is used throughout the problem. Check your worksheet by changing the units sold in the Data to 6,000 for Year 2. The cost of goods sold under absorption costing for Year 2 should now be $240,000. If it Isn't, check cell C41. The formula in this cell should be =IF(C26 12 2 3 Data 4 Selling price per unit 5 Manufacturing costs: 6 Variable per unit produced: 7 Direct materials 8 Direct labor 9 10 Variable manufacturing overhead Fixed manufacturing overhead per year 11 Selling and administrative expenses: Variable per unit sold $50 $11 $8 $3 $120,000 $4 13 Fixed per year $70,000 14 15 Year 1 Year 2 16 Units in beginning inventory 0 17 Units produced during the year 10,000 6,000 18 Units sold during the year 8,000 8,000 19 20 Enter a formula into each of the cells marked with a ? below 21 Review Problem 1: Contrasting Variable and Absorption Costing 22 23 Compute the Ending Inventory 24 25 Units in beginning inventory 26 Units produced during the year 27 Units sold during the year 28 Units in ending inventory Year 1 0 Year 2 ? ? ? ? ? ? ? 29 30 Compute the Absorption Costing Unit Product Cost 31 32 Direct materials 33 Direct labor 34 Variable manufacturing overhead 35 Fixed manufacturing overhead 36 Absorption costing unit product cost 37 Year 1 Year 2 ? ? ? ? ? ? ? ? ? ? 38 Construct the Absorption Costing Income Statement 39 40 Sales 41 Cost of goods sold 42 Gross margin 43 Selling and administrative expenses 44 Net operating income 45 Year 1 Year 2 ? ? ? ? ? ? ? ? ? ? 46 Compute the Variable Costing Unit Product Cost 47 48 Direct materials 49 Direct labor 50 Variable manufacturing overhead 51 Variable costing unit product cost 52 53 Construct the Variable Costing Income Statement 54 55 Sales 56 Variable expenses: Year 1 Year 2 ? ? ? ? ? ? ? ? Year 1 Year 2 ? ? 57 Variable cost of goods sold ? ? 59 Contribution margin 60 Fixed expenses: 61 58 Variable selling and administrative expens Fixed manufacturing overhead ? ? ? ? ? ? ? ? 62 Fixed selling and administrative expenses ? ? ? 63 Net operating income 64