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Step $1$

Requirement a

Computation of Manufacturing cost per unit

Given that,

Particulars

Amount $($$$)$

Working

Direct material

$48$

$912000/19000$

Direct labor

$35$

$665000/19000$

Variable manufacturing overhead

$21$

$399000/19000$

Fixed manufacturing overhead

$31\mathrm{.}2$

$741000/23750$

Manufacturing cost per unit

$135\mathrm{.}2$

Manufacturing cost per unit $=$ $ $135\mathrm{.}2$ per unit

Explanation:

Manufacturing cost per unit $=$ Direct material $+$ Direct labor $+$ Variable manufacturing overhead $+$ Fixed manufacturing overhead

Step $2$

Requirement b

Preparation of Income Statement Normal Absorption Costing year Ended December $31,2022.$

Sheridan Corp.

Income Statement$-$Normal Absorption Costing

Year Ended December $31,2022$

Production in units

$19000$Pairs

Sales in units

$17000$Pairs

Sales

$3400000$

$(17000*$$$200)$

$(-)$ Cost of goods sold

Inventory, beginning

$0$

$(+)$ Cost of goods manufactured

$2,568,800$

$(19,000*$$$135\mathrm{.}2)$

Cost of goods available for sale

$2,568,800$

$(-)$ Inventory, ending

$-270,400$

$(2,000*$$$135\mathrm{.}2)$

Cost of goods sold

$2,298,400$

Volume variance

$148,200$

$2,446,600$

Gross profit

$953,400$

$(-)$ Marketing costs:

Variable marketing costs

$153,000$

Fixed marketing cost

$195,000$

Total maketing costs

$348,000$

Net income

$605,400$ Reconcile the difference in net income between the absorption costing and normal absoprtion costing methods