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Need help with A,B and C. Found a few answers here but not a perfect one so please dont copy and paste others answers tyia
Need help with A,B and C. Found a few answers here but not a perfect one so please dont copy and paste others answers tyia :)
Electricoil is a division of Meier Corp. The division manufactures and sells an electric coil used in many businesses. During 2017, it expects to sell 200,000 units for $9 per unit. The division manager is considering producing either 200,000 or 250,000 units during 2017. Other information is presented in the schedule. Division information for 2017 Beginning inventory Expected sales in units Selling price per unit Variable mfg costs per unit Fixed mfg overhead costs 0 200.000 $ 9 $ 3 $ 500,000 (total) Fixed manufacturing overhead costs per unit: Based on 200,000 units $2.50 per unit ($50.000 / 200.000) Based on 250,000 units $2.00 per unit ($500,000 - 250,000) Total Manufacturing costs per unit: Based on 200,000 units $5.50 per unit ($3 variable + $2.50 fixed) Based on 250,000 units $5.00 per unit ($3 variable + $2.00 fixed) Variable selling and administrative expense Fixed selling and administrative expense (total) $0.40 $15,000 Instructions (a) Prepare an absorption costing income statement, with one column showing the results if 200 units are produced and one column showing the results if 250,000 units are produced. (b) Prepare a variable costing income statement, with one column showing the results if 200,000 units are produced and one column showing the results if 250,000 units produced (c) Reconcile the differences in net incomes under the two approaches and explain what accounts for this difference. ELECTRICOIL DIVISION Income Statement For the Year Ended December 31, 2017 Absorption Costing Salos" same in both cols since only 200.000 sold in each production scenario unit 200,000 Produced 250,000 Producederunt in each scenarie. Both S&A Exp stay same under absorption since only 200,000 are sold 1.800.000 1,800,000 Sales (200,000 units x 50 Cost of goods sold Gross profit Variable Sell & Adm exp (200,000x400) Fixed Sell & Adm exp Net Income 80,000 80,000 15,000 15,000 ELECTRICOIL DIVISION Income Statement For the Year Ended December 31, 2017 Variable Costing Sales" sti same in both cols since only 200.000 sold in each production scenario b) 200,000 250,000 Produced in 200.000 unts Var CGS and Var Exp based on Produced Both S&A Ex stay same under absorption since only 200.000 are so 1,800,000 1,800,000 Sales (200,000 units x 59) Variable Cost Goods Sold Variable Selling & Adm Expl Contribution margin Fixed Mfg OH Fixed Selling & Adm exp Net Income 500,000 15,000 500,000 15,0001 Don't forget this: (see answers below for help) Step by Step Solution
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