Income Statement with Variances

Giovanni Company produces a product that requires four standard gallons per unit. The standard price is $34.00 per gallon. Assume the company produced 3,500 units of product. The 3,500 units required 14,400 gallons, which were purchased at $33.25 per gallon. The product requires five standard hours per unit at a standard hourly rate of $30 per hour. The 3,500 units required 17,700 hours at an hourly rate of $30.50 per hour. The standard variable overhead cost per unit is $3.50 per hour. The actual variable factory overhead was $63,400. The standard fixed overhead cost per unit is $1.80 per hour at 17,000 hours, which is 100% of normal capacity.

Prepare a 2014 income statement through gross profit for Giovanni Company. Assume Giovanni sold 3,500 units at $400 per unit. Enter all amounts as positive numbers. If an amount does not require an entry or is zero, enter "0".

Giovanni Company

Income Statement Through Gross Profit

For the Year Ended December 31, 2014

Sales ___________________

Cost of goods sold at Standard ___________________

Gross profit-at standard __________________

Favorable

Unfavorable

Less variances from standard cost:

Direct materials price __________ __________

Direct materials quantity __________ __________

Direct labor rate __________ ___________

Direct labor time __________ ___________

Factory overhead controllable __________ ___________

Factory overhead volume __________ ___________ _______________

Gross profit _______________