Question
Nesman Company, which has only one product, has provided the following data concerning its most recent month of operations: Selling price $ 104 Units in
| Nesman Company, which has only one product, has provided the following data concerning its most recent month of operations: |
| Selling price | $ | 104 |
| Units in beginning inventory | 320 | |
| Units produced | 6,860 | |
| Units sold | 6,220 | |
| Units in ending inventory | 960 | |
| Variable cost per unit: | ||
| Direct materials | $ | 41 |
| Direct labor | $ | 20 |
| Variable manufacturing overhead | $ | 2 |
| Variable selling and administrative | $ | 11 |
| Fixed costs: | ||
| Fixed manufacturing overhead | $ | 137,200 |
| Fixed selling and administrative | $ | 43,540 |
| The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. |
| Required: |
| a. | Prepare a contribution format income statement for the month using variable costing. (Input all amounts as positive values except losses which should be indicated by a minus sign. Omit the "$" sign in your response.) |
| Variable Costing Income Statement | ||
| (Click to select) Selling and administrative expenses Variable cost of goods sold Net operating income (loss) Variable selling and administrative expenses Manufacturing overhead Contribution margin Sales | $ | |
| Variable expenses: | ||
| (Click to select) Contribution margin Variable selling and administrative expenses Direct labor Net operating income Manufacturing overhead Variable cost of goods sold Sales | $ | |
| (Click to select) Sales Contribution margin Variable cost of goods sold Direct labor Net operating income Manufacturing overhead Variable selling and administrative expenses | ||
| (Click to select) Net operating income (loss) Sales Variable selling and administrative expenses Variable cost of goods sold Contribution margin Manufacturing overhead Selling and administrative expenses | ||
| Fixed expenses: | ||
| (Click to select) Net operating income Variable cost of goods sold Fixed selling and administrative expenses Contribution margin Variable selling and administrative expenses Sales Fixed manufacturing overhead | ||
| (Click to select) Net operating income Contribution margin Fixed manufacturing overhead Variable selling and administrative expenses Fixed selling and administrative expenses Sales Variable cost of goods sold | ||
| (Click to select) Contribution margin Variable selling and administrative expenses Selling and administrative expenses Sales Net operating income (loss) Variable cost of goods sold Manufacturing overhead | $ | |
| b. | Prepare an income statement for the month using absorption costing. (Input all amounts as positive values except losses which should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.) |
| Absorption Costing Income Statement | ||
| (Click to select) Net operating income (loss) Cost of goods sold Selling and administrative expenses Sales Gross margin | $ | |
| (Click to select) Sales Net operating income (loss) Gross margin Selling and administrative expenses Cost of goods sold | ||
| (Click to select) Net operating income (loss) Cost of goods sold Gross margin Sales Selling and administrative expenses | ||
| (Click to select) Cost of goods sold Gross margin Net operating income (loss) Selling and administrative expenses Sales | ||
| (Click to select) Sales Selling and administrative expenses Net operating income (loss) Cost of goods sold Gross margin | $ | |
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