Prepare an income statement using absorption costing and thr traditional method format.

 

A company has collected the following information for the year: Units produced Units sold DM, DL, VOHI Variable Selling & Admin Fixed Overhead Fixed Selling 1,000 800@ $45 $6.00 per unit $1.00 per unit $16,000 $12,000 The company had no beginning inventory. The company prepared the following income statement using variable costing. Based on this income statement, management believes the true NOI is $2,400, however the income statement prepared for external reporting shows a higher NOI than what is shown on the variable costing income statement. Variable Costing Income Statement for the Year Sales Variable product expenses Variable period expenses Total variable expenses Contribution margin Total fixed expenses NOI $36,000 4,800 800 5.600 30,400 28.000 $2,400