Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Race Track Motors assembles and sells motor vehicles and uses standard costing. Actual data relating to April and May 2020 are as follows: Click the

image text in transcribed
image text in transcribed
image text in transcribed
Race Track Motors assembles and sells motor vehicles and uses standard costing. Actual data relating to April and May 2020 are as follows: Click the icon to view the data) The selling price per vehicle is $22,000. The budgeted level of production used to calculate the budgeted fixed manufacturing cost per unit is 600 units. There are no price, efficiency, or spending variances. Any production-volumo varianco is writton off to cost of goods sold in the month in which it occurs. Read the requirements Requirement 1. Prepare April and May 2020 income statements for Race Track Motors under (a) variable costing and (b) absorption costing. (a) Prepare April and May 2020 Income statements for Race Track Motors under variable costing Complete the top half of the income statement for each month first, then complete the bottom portion (Complete all input fields. Enter a "0" for any zoro balance accounts.) April 2020 May 2020 Revenues Variable cost of goods sold Beginning inventory Variable manufacturing costs Cost of goods available for sale Deduct ending inventory Variable cost of goods sold Variable operating costs Contribution margin Requirements 1. Prepare April and May 2020 income statements for Race Track Motors under (a) variable costing and (b) absorption costing. 2. Prepare a numerical reconciliation and explanation of the difference between operating income for each month under variable costing and absorption costing. B 1 April May 2 Unit data: 3 Beginning inventory 0 150 4 Production 600 500 5 Sales 450 600 6 Variable costs: 7 $ 10,500 $ 10,500 Manufacturing cost per unit produced Operating (marketing) cost per unit sold 8 2,000 2,000 9 Fixed costs: 10 Manufacturing costs 11 Operating (marketing) costs $ 2,400,000 $ 2,400,000 550,000 550,000

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Application Of Quantitative Techniques For The Prediction Of Bank Acquisition Targets

Authors: Pasiouras Fotios

1st Edition

9812565183, 9789812565181

More Books

Students also viewed these Accounting questions

Question

Why are icebergs often surrounded by fog?

Answered: 1 week ago