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Ogilvy Company manufactures and sells one product. The following information pertains to each of the company's first three years of operations Variable cost per unit
Ogilvy Company manufactures and sells one product. The following information pertains to each of the company's first three years of operations Variable cost per unit Direct materials 29 Fixed costs per year $1,606,000 S 835,000 Fixed selling and administrative expenses 284,000 Direct labor Fixed manufacturing overhead The company does not incur any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, Ogilvy produced 73,000 units and sold 73,000 units. During its second year of operations, it produced 73,000 units and sold 68,600 units. In its third year Ogilvy produced 73,000 units and sold 77,400 units. The selling price of the company's product is $67 per unit Required: 1. Assume the company uses super-variable costing: a. Compute the unit product cost for Year 1, Year 2, and Year 3 Unit Product Cost Year 1 Year 2 Year 3 b. Prepare an income statement for Year 1, Year 2, and Year 3. Ogilvy Company Super-Variable Costing Income Statement Year 1 Year 2 Year 3 Fixed expenses Total fixed expenses Net operating income (loss)
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