please answer a and b part
The Daniels Tool & Die Corporation has been in existence for a little over three years. The company's sales have been increasing each year as it builds a reputation. The company manufactures dies to its customers' specifications and therefore uses a job order cost system. Factory overhead is applied to the jobs based on direct labour hours-the absorption costing (full) method. Overapplied or underspelled overhead is treated as an adjustment to cost of Goods Sold. The company's income Matements and other data for the last two years are as follows: DANIELS TOOL A DEE CORPORATION 2015-2016 Comparative Income statements 2015 2016 Sales 583),200 $1,015,800 Cost of goods so Finished goods, January 1 24,900 17,800 Cost of goods manufactured 541,000 652,600 Total avati 545,900 670,400 Finished goods, December 31 17.000 14,000 Cost of goods sold before overhead adjustment 546.100 656,400 Underapplied factory overhead 35,100 14.000 Cost of goods sold 58), 200 670,400 Gross sro 250,000 345.400 Selling expenses 81,600 94,300 Administrative expenses 69,800 74,000 Total operating expenses 151.400 168,00 Operating income 598.600 $177.100 Daniels Tool Die Corporation Inventory Balances January 1, 2015 December 31, 2015 December 31, 2016 material 522,000 $29.400 $10.200 Work in process 540,600 $48.000 $63,700 Direct labour hours (used in WIP) 1,330 1,660 Finished goods 2,310 $24.900 $17,800 $14,000 Director hours (used in FG) 1.420 1,010 830 Daniels used the same predetermined overhead rate in applying overhead to its production orders in both 2015 and 2016. The rate was based on the following estimates: Feed factory overhead $24.880 Variable factory overhead $154,256 Direct labour hours (used in WIP) 24,850 Direct labour costs (used in FG) $149,280 In 2015 and 2016, the actual direct labour hours used were 20.300 and 23,300, respectively. Raw materials put into production were $291,700 in 2015 and $370,200 in 2016. The actual fixed overhead was $42,700 for 2015 and $27,000 for 2016, and the planned direct labour rate was the direct labour achieved For both years, all of the administrative costs were fired. The variable portion of the selling expenses results from a 5% commission that is paid as a percentage of the sales revenue. ia "(a) For the year ended December 31, 2016, prepare a revised income statement for Daniels Tool & Die Corporation using the variable-costing method. (Round answers to decimal places, ... 5,275.) Daniels Tools & Dla Corporation Variable Costing Income Statement For the year ended December 31, 2016 b. Reconcile the difference in operating income between Daniels Tool & Die Corporation's 2020 absorption-costing income statement and the revised 2020 income statement prepared under variable costing. The Daniels Tool & Die Corporation has been in existence for a little over three years. The company's sales have been increasing each year as it builds a reputation. The company manufactures dies to its customers' specifications and therefore uses a job order cost system. Factory overhead is applied to the jobs based on direct labour hours-the absorption costing (full) method. Overapplied or underspelled overhead is treated as an adjustment to cost of Goods Sold. The company's income Matements and other data for the last two years are as follows: DANIELS TOOL A DEE CORPORATION 2015-2016 Comparative Income statements 2015 2016 Sales 583),200 $1,015,800 Cost of goods so Finished goods, January 1 24,900 17,800 Cost of goods manufactured 541,000 652,600 Total avati 545,900 670,400 Finished goods, December 31 17.000 14,000 Cost of goods sold before overhead adjustment 546.100 656,400 Underapplied factory overhead 35,100 14.000 Cost of goods sold 58), 200 670,400 Gross sro 250,000 345.400 Selling expenses 81,600 94,300 Administrative expenses 69,800 74,000 Total operating expenses 151.400 168,00 Operating income 598.600 $177.100 Daniels Tool Die Corporation Inventory Balances January 1, 2015 December 31, 2015 December 31, 2016 material 522,000 $29.400 $10.200 Work in process 540,600 $48.000 $63,700 Direct labour hours (used in WIP) 1,330 1,660 Finished goods 2,310 $24.900 $17,800 $14,000 Director hours (used in FG) 1.420 1,010 830 Daniels used the same predetermined overhead rate in applying overhead to its production orders in both 2015 and 2016. The rate was based on the following estimates: Feed factory overhead $24.880 Variable factory overhead $154,256 Direct labour hours (used in WIP) 24,850 Direct labour costs (used in FG) $149,280 In 2015 and 2016, the actual direct labour hours used were 20.300 and 23,300, respectively. Raw materials put into production were $291,700 in 2015 and $370,200 in 2016. The actual fixed overhead was $42,700 for 2015 and $27,000 for 2016, and the planned direct labour rate was the direct labour achieved For both years, all of the administrative costs were fired. The variable portion of the selling expenses results from a 5% commission that is paid as a percentage of the sales revenue. ia "(a) For the year ended December 31, 2016, prepare a revised income statement for Daniels Tool & Die Corporation using the variable-costing method. (Round answers to decimal places, ... 5,275.) Daniels Tools & Dla Corporation Variable Costing Income Statement For the year ended December 31, 2016 b. Reconcile the difference in operating income between Daniels Tool & Die Corporation's 2020 absorption-costing income statement and the revised 2020 income statement prepared under variable costing
