Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Oak Mart, a producer of solid oak tables, reports the following data from its second year of business. Sales price per unit $ 320 per
Oak Mart, a producer of solid oak tables, reports the following data from its second year of business.
Sales price per unit | $ | 320 | per unit |
Units produced this year | 105,000 | units | |
Units sold this year | 109,000 | units | |
Units in beginning-year inventory | 4,000 | units | |
Beginning inventory costs | |||
Variable (4,000 units $130) | $ | 520,000 | |
Fixed (4,000 units $75) | 300,000 | ||
Total | $ | 820,000 | |
Manufacturing costs this year | |||
Direct materials | $ | 40 | per unit |
Direct labor | $ | 62 | per unit |
Overhead costs this year | |||
Variable overhead | $ | 3,400,000 | |
Fixed overhead | $ | 7,200,000 | |
Selling and administrative costs this year | |||
Variable | $ | 1,450,000 | |
Fixed | 4,200,000 | ||
1. Prepare the current-year Income statement for the company using variable costing OAK MART COMPANY Variable Costing Income Statement Beginning inventory: Manufacturing costs this year 0 0 Net income (loss) 2. Prepare the current-year Income statement for the company using absorption costing. OAK MART COMPANY Absorption Costing Income Statement Beginning inventory Manufacturing costs this year Net income (loss) Fixed costs added to subtracted from) inventory
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started