Jorgensen Inc. manufactures opera glasses.The company uses actual costing systems.The opera glasses sell for $290 each. For 2019, the company budgeted fixed manufacturing overhead of $160,000 and fixed selling and administrative costs of $25,000. Budgeted production was 5,000 units.

At the end of the year, the following actual results reported:

Opening inventory was 500 units, with assigned cost of $45,000.

Sales were 5,500 units and production was 6,000 units.

Total variable manufacturing costs (direct labour and direct materials) was $455,000.

Fixed manufacturing overhead was $160,000, as budgeted.

Variable selling and administrative costs were $19.95 per unit.

Actual fixed selling and administrative costs were $280,000.

How to make an income statement using absorption and variable costing