Rikki Company developed the unit information presented at right for January and February of 2017, its first two months of operations.

The fixed costs represent monthly amounts.

During January, 12,000 units were produced and 9,000 units were sold.

During February, 9,000 units were produced and 12,000 were sold.

Prepare income statements for January and February under both variable costing and absorption costing (i.e. four income statements total).

In addition, perform a CVP analysis for Rikki Co and determine the break-even point in monthly unit sales, assuming the results for January and February are representative.

Finally, calculate Rikki's margin of safety in February.

		Per Unit		Total Costs
Sales Price		$77.00
Variable Costs
Direct Materials		$8.00
Direct Labor		$9.00
Variable MOH		$6.00
Selling, general, and administrative		$7.00
Fixed SG&A				$210,000.00
Fixed MOH				$216,000.00