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Required: Using the full costing method, prepare the income statement for 2 0 2 2 . 2 - a . Using variable costing, prepare an
Required:
Using the full costing method, prepare the income statement for
a Using variable costing, prepare an income statement for each period.
b Prepare a reconciliation of the difference each year in the operating income resulting from the full and variablecosting methods.
Complete this question by entering your answers in the tabs below.
Using the full costing method, prepare the income statement for Complete this question by entering your answers in the tabs below.
Req
Req
Req B
Using variable costing, prepare an income statement for each period.
MARK HANCOCK, INCORPORATED Required:
Using the full costing method, prepare the income statement for
a Using variable costing, prepare an income statement for each period.
b Prepare a reconciliation of the difference each year in the operating income resulting from the full and variablecosting methods.
Complete this question by entering your answers in the tabs below.
Req B
Prepare a reconciliation of the difference each year in the operating income resulting from the full and variablecosting
methods. Negative amounts should be indicated by a minus sign.Please help with this question, and please answer all parts. Also please present the questions in a similar format as the question does, thanks so much.
Mark Hancock Incorporated manufactures a specialized surgical instrument called the HAN The firm has grown rapidly in recent
years because of the product's low price and high quality. However, sales have declined this year primarily due to increased
competition and a decrease in the surgical procedures for which the HAN is used. The firm is concerned about the decline in sales
and has hired a consultant to analyze the firm's profitability. The consultant was provided the following information:
Top management at Hancock explained to the consultant that a difficult business environment for the firm in and had
caused the firm to reduce its price and production levels and reduce its fixed manufacturing costs in response to the decline in sales.
Even with the price reduction, there was a decline in sales in both years. This led to an increase in inventory in which the firm
was able to reduce in by further reducing the level of production. In both years, Hancock's actual production was less than the
budgeted level so that the overhead rate for fixed overhead, calculated from budgeted production levels, was too low, and a
production volume variance was calculated to adjust cost of goods sold for the underapplied fixed overhead the calculation of the
production volume variance is explained fully in Chapter and reviewed briefly below
The production volume variance for was determined from the fixed overhead rate of $ per unit $ budgeted
units Because the actual production level was units short of the budgeted level in the amount of the
production volume variance in was $$ The production volume variance is underapplied because the actual
production level is less than budgeted, and the production volume variance is therefore added back to cost of goods sold to
determine the amount of cost of goods sold in the full costing income statement. The full costng income statement for is shown
below:
Required:
Using the full costing method, prepare the income statement for
a Using variable costing, prepare an income statement for each period.
b Prepare a reconciliation of the difference each year in the operating income resulting from the full and variablecosting methods.
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