Millard Corporation is a wholesale distributor of office products. It purchases office products from manufacturers and distributes them in the West, Central, and East regions. Each of these regions is about the same size and each has its own manager and sales staff. The company has been experiencing losses for many months. In an effort to improve performance, management has requested that the monthly income statement be segmented by sales region. The company's first effort at preparing a segmented income statement for May is given below. West $ 311,000 Sales Region Central $ 802,000 East $ 705,000 Sales Regional expenses (traceable): Cost of goods sold Advertising Salaries Utilities Depreciation Shipping expense Total regional expenses Regional income (loss) before corporate expenses Corporate expenses: Advertising (general) General administrative expense Total corporate expenses Net operating income (loss) 97,000 106,000 56,000 9,000 21,000 13,000 302,000 9,000 235,000 240,000 55,000 16,400 34,000 28,000 608,400 193,600 317,000 237,000 111,000 13,800 30,000 42,000 750, 800 (45, 800) 15,000 22,000 37,000 $ (28,000) 39,000 22,000 61,000 (132,600) 34,000 22,000 56,000 $ (101,800) The cost of goods sold and shipping expense are both variable. All other costs are fixed. Required: 3. Prepare a new contribution format segmented income statement for May. (Round percentage answers to 1 decimal place.) Total Company West Central East Amount % Amount % Amount % Amount % Variable expenses: Total variable expenses Traceable fixed expenses: Total traceable fixed expenses Common fixed expenses: Total common fixed expense Net operating income (loss) Tami Tyler opened Tami's Creations, Incorporated, a small manufacturing company, at the beginning of the year. Getting the company through its first quarter of operations placed a considerable strain on Ms. Tyler's personal finances. The following income statement for the first quarter was prepared by a friend who has just completed a course in managerial accounting at State University. $ 1,120,000 Tami's Creations, Incorporated Income Statement For the Quarter Ended March 31 Sales (28,000 units) Variable expenses: Variable cost of goods sold $ 462,000 Variable selling and administrative 168,000 Contribution margin Fixed expenses: Fixed manufacturing overhead 300,000 Fixed selling and administrative 200,000 Net operating loss 630,000 490,000 500,000 $ (10,000) Ms. Tyler is discouraged over the loss shown for the quarter, particularly because she had planned to use the statement as support for a bank loan. Another friend, a CPA, insists that the company should be using absorption costing rather than variable costing and argues that if absorption costing had been used the company probably would have reported at least some profit for the quarter. At this point, Ms. Tyler is manufacturing only one product-a swimsuit. Production and cost data relating to the swimsuit for the first quarter follow: 30,000 28,000 Units produced Units sold Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative $ 3.50 $ 12.00 $ 1.00 $ 6.00 Required: 1. Complete the following: a. Compute the unit product cost under absorption costing. b. What is the company's absorption costing net operating income (loss) for the quarter? c. Reconcile the variable and absorption costing net operating income (loss) figures. 3. During the second quarter of operations, the company again produced 30,000 units but sold 32,000 units. (Assume no change in total fixed costs.) a. What is the company's variable costing net operating income (loss) for the second quarter? b. What is the company's absorption costing net operating income (loss) for the second quarter? c. Reconcile the variable costing and absorption costing net operating incomes for the second quarter. Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 10 Req Req 3B Req 3C Compute the unit product cost under absorption costing. (Round your answer to 2 decimal places.) Unit product cost Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req ic Req Req 3B Req 30 What is the company's absorption costing net operating income (loss) for the quarter? (Round your intermediate calculations to 2 decimal places.) Tami's Creations, Incorporated Absorption Costing Income Statement Total Sales 0 Cost of goods sold Gross margin Selling and administrative expenses Net operating income $ 0 Complete this question by entering your answers in the tabs below. Req 1A Reg 1B Req 1C Req Req 3B Req 30 Reconcile the variable and absorption costing net operating income (loss) figures. (Enter any losses or deductions as a negative value.) Reconciliation of Variable Costing and Absorption Costing Net Operating Incomes Variable costing net operating income (loss) Add: Fixed manufacturing overhead cost deferred in inventory under absorption costing Absorption costing net operating income (loss) Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 1C Req Req 3B Req 3C During the second quarter of operations, the company again produced 30,000 units but sold 32,000 units. What is the company's variable costing net operating income (loss) for the second quarter? Tami's Creations, Incorporated Variable Costing Income Statement 0 0 0 $ 0 Complete this question by entering your answers in the tabs below. Req 1A Reg 1B Req 1c Req Req 3B Req 30 During the second quarter of operations, the company again produced 30,000 units but sold 32,000 units. What is the company's absorption costing net operating income (loss) for the second quarter? (Round your intermediate calculations to 2 decimal places.) Tami's Creations, Incorporated Absorption Costing Income Statement Total 0 $ 0 Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 1c Req Req 3B Req 30 During the second quarter of operations, the company again produced 30,000 units but sold 32,000 units. Reconcile the variable costing and absorption costing net operating incomes for the second quarter. (Losses and deductions should be entered as a negative.) Reconciliation of Variable Costing and Absorption Costing Net Operating Incomes Variable costing net operating income (loss) Absorption costing net operating income (loss)