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using the variable costing concept ,prepar income statements for (a)may and (b)june

Chapter 7 Variable Costing for Management Analysis 341 During June, Big Sky Creations produced 32,000 designer cowboy boots and sold 36,000 cowboy boots. Operating data for June are summarized as follows: Sales ... $4,500,000 Manufacturing costs: ( Direct materials ...... $ 768,000 Direct labor ...... 1,600,000 Variable manufacturing cost 416,000 Fixed manufacturing cost ...... . . . 120,000 2,904,000 Selling and administrative expenses: Variable . ...... $ 72,000/ Fixed ...... 80,000 152,000 Instructions 1. Using the absorption costing concept, prepare income statements for (a) May and (b) June.PR 7-3A Absorption and variable costing income statements for Obj. 1, 2 two months and analysis b. Operating During the first month of operations ended May 31, Big Sky Creations Company produced 40,000 $1,084,000 designer cowboy boots, of which 36,000 were sold. Operating data for the month are summarized as follows: $4,500,000 W ME HOW Sales Manufacturing costs: Direct materials ..... $ 960,000 Direct labor ...... 2,000,000 Variable manufacturing cost .. . . . ... 520,000 Fixed manufacturing cost ........... 120,000 3,600,000 Selling and administrative expenses: Variable ...... $ 72,000 Fixed ..... 80,000 152,000