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Question 2 (11 points) In the first year of operations, ending December 31, 2020, Domi Corporation sold 35,000 units at $35 each, and produced 38,000
Question 2 (11 points) In the first year of operations, ending December 31, 2020, Domi Corporation sold 35,000 units at $35 each, and produced 38,000 units. Additional information is as follows: Variable costs per unit: Direct material $6 Direct labour 7 Variable manufacturing overhead 4 Variable selling and administrative 3 Total fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative $304,000 195,000 Required: 1. Prepare a contribution format income statement in good form using variable costing. (9 marks) 2. Calculate the difference in operating income between variable costing and absorption costing. Do not prepare an absorption costing income statement. (2 marks)
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