Question
Nesman Company, which has only one product, has provided the following data concerning its most recent month of operations: Selling price $ 113 Units in
| Nesman Company, which has only one product, has provided the following data concerning its most recent month of operations: |
| Selling price | $ | 113 |
| Units in beginning inventory | 350 | |
| Units produced | 6,300 | |
| Units sold | 6,070 | |
| Units in ending inventory | 580 | |
| Variable cost per unit: | ||
| Direct materials | $ | 43 |
| Direct labor | $ | 20 |
| Variable manufacturing overhead | $ | 3 |
| Variable selling and administrative | $ | 15 |
| Fixed costs: | ||
| Fixed manufacturing overhead | $ | 151,200 |
| Fixed selling and administrative | $ | 36,420 |
| 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 Sales Net operating income (loss) Contribution margin Manufacturing overhead Variable selling and administrative expenses Variable cost of goods sold | $ | |
| Variable expenses: | ||
| (Click to select) Variable selling and administrative expenses Net operating income Manufacturing overhead Direct labor Variable cost of goods sold Sales Contribution margin | $ | |
| (Click to select) Manufacturing overhead Net operating income Variable selling and administrative expenses Variable cost of goods sold Sales Direct labor Contribution margin | ||
| (Click to select) Sales Manufacturing overhead Selling and administrative expenses Variable cost of goods sold Contribution margin Variable selling and administrative expenses Net operating income (loss) | ||
| Fixed expenses: | ||
| (Click to select) Variable selling and administrative expenses Variable cost of goods sold Net operating income Contribution margin Fixed selling and administrative expenses Fixed manufacturing overhead Sales | ||
| (Click to select) Fixed selling and administrative expenses Sales Variable cost of goods sold Contribution margin Net operating income Variable selling and administrative expenses Fixed manufacturing overhead | ||
| (Click to select) Manufacturing overhead Contribution margin Sales Net operating income (loss) Variable selling and administrative expenses Variable cost of goods sold Selling and administrative expenses | $ | |
| 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) Sales Cost of goods sold Selling and administrative expenses Net operating income (loss) Gross margin | $ | |
| (Click to select) Sales Cost of goods sold Selling and administrative expenses Net operating income (loss) Gross margin | ||
| (Click to select) Selling and administrative expenses Net operating income (loss) Cost of goods sold Gross margin Sales | ||
| (Click to select) Net operating income (loss) Cost of goods sold Sales Selling and administrative expenses Gross margin | ||
| (Click to select) Net operating income (loss) Gross margin Selling and administrative expenses Sales Cost of goods sold | $ | |
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