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please show math o a AM B Problem 5.2 (LO1, 2) Excel Variable and Full Costing: Sales and Production Fluctuate Hamilton Stage Supplies is a
please show math
o a AM B Problem 5.2 (LO1, 2) Excel Variable and Full Costing: Sales and Production Fluctuate Hamilton Stage Supplies is a manufacturer of a specialized type of light used in theaters. Information on the first three years of business is as follows: 2020 2021 2022 Total Units sold 5,000 5.000 5.000 15.000 Units produced 5.000 6,000 4.000 15.000 Fixed production costs $ 48,000 $ 48,000 $ 48,000 Variable production cost per unit $ 755 175 Selling price per unit 5 995 $ 9355 935 Fixed selling and administrative expense $400,000 $400,000 $100,000 Required a. Calculate profit and the value of ending inventory for each year using full costing b. Explain why protit fluctuates from year to year even though the number of units sold, the selling price, and the cost structure remain contant c. Calculate profit and the value of ending inventory for each year using variable costing d. Explain why, using variable costing profit does not fluctuate from year to year. 25 5 Total 15,000 15,000 Hamilton Stage Supplies is a manufacturer of a specialized type of light used in theaters three years of business is as follows: 2020 2021 Units sold 5,000 5,000 Units produced 5,000 6,000 Fixed production costs $50,000 $50,000 Variable production costs per unit 75 75 Selling price per unit 225 225 Fixed selling and administrative expense 5,000 5,000 Required a. Calculate profit and the value of ending inventory for each year using full costing. 2022 5,000 4,000 $50,000 75 225 5,000 2020 2021 2022 Fixed production overhead units produced fixed production overhead per unit variable production costs per unit Full cost per unit sales less: cost of goods sold gross margin less: selling and administrative expense Net income Units Sold Units Produced Value of ending inventory b. Explain why profit fluctuates from year to year even though the number of units sold, the selling price, and the cost structure remain constant. Net income will continue to fluctuate from year to year even with the number of units sold, the selling price and the cost of structure remaining constant. This is due to full cost per unit fluctuating. Full cost can chage based on if production increases or decreases. c. Calculate profit and the value of ending inventory for each year using variable costing. Net income Value of ending inventory Step by Step Solution
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