Rundle Manufacturing pays its production managers a bonus based on the company's profitability. During the two most recent years, the company maintained the same cost structure to manufacture its products. Unita Produced Unita Sold 4,000 6.000 4.000 4,000 Year Production and Sales Year 2 Year 3 Cost Data Direct materials Direct labor Manufacturing overhead-variable Manufacturing overhead-fixed Variable selling and administrative expenses Fixed selling and administrative expenses $ 14.20 per unit $ 23.10 per unit $10.40 per unit $101,400 $ 7.70 per unit sold $ 52,000 (Assume that selling and administrative expenses are associated with goods sold.) Rundle sells its products for $109.90 per unit Required a. Prepare Income statements based on absorption costing for Year 2 and Year 3. ams Swed Help Save = my work mode : This shows what is correct or incorrect for the work you have completed so far. It does not indicate co Rel Req A Year 2 Reg A Year 3 ReqB Reg D Req E Year 2 Reg E Year 3 Prepare Income statements based on absorption costing for Year 2. (Do not round Intermediate calculations.) RUNDLE MANUFACTURING Absorption Costing Income Statement For the Year Ended Dec. 31. Year 2 Revenues $ 439,600 Cost of Goods Sold: Direct materials $ 56,800 Direct labor 92.400 Manufacturing overhead 143,000 292 200 147.400 Gross margin Selling and administrative expenses 82,800 Net Income $ 64,600 Prey 2 of 2 Next Req A Year 2 Req A Year 3 Req B Reg D Reg E Year 2 Req E Year 3 Prepare income statements based on absorption costing for Year 2. (Do not round Intermediate calculations..... $ 439,600 RUNDLE MANUFACTURING Absorption Conting Income Statement For the Year Ended Dec. 31, Year 2 Revenues Cost of Goods Sold: Direct materials $ 56,800 Direct labor 92.400 Manufacturing overhead 143,000 292,200 147.400 Gross margin Selling and administrative expenses 82,800 Not income $ 64,600 Req A Year 2 Req A Year 3 Req B ReqD Req E Year 2 Req E Year 3 Prepare income statements based on absorption costing for Year 3. (Do not round Intermediate calculations.) RUNDLE MANUFACTURING Absorption Costing Income Statement For the Year Ended Dec. 31, Year 3 Revenues $ 439,600 Cost of Goods Sold: Direct materials $ 56,800 Direct labor 92,400 Manufacturing overhead 109,200 258,400 181.200 Gross margin Selling and administrative expenses 82,800 Net income $ 98,400 Complete this question by entering your answers in the tabs below. Reg A Year 2 Reg A Year 3 ReqB Reg D Req E Year 2 Reg E Year 3 Since Levine sold the same number of units in Year 2 and Year 3, why did net income increase in Year 37 Why did not income increase in Year 37 Decrease in fixed manufacturing cost Req A Year 2 Req A Year 3 ReqB ReqD Req E Year 2 Req E Year 3 Determine the costs of ending inventory for Year 3. (Do not round Intermediate calculations.) Ending Inventory 101,400 Req B Req E Year 2 > RUNDLE MANUFACTURING Variable Costing Income Statement For the Year Ended Dec. 31. Year 2 Revenues $ 439,600 Variable costs: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative expenses $ 56,800 92,400 41,600 30,800 221,600 Contribution margin Fixed manufacturing overhead Fixed selling and administrative expenses 218,000 101,400 52,000 Net income $ 64,600 RUNDLE MANUFACTURING Variable Costing Income Statement For the Year Ended Dec. 31. Year 3 Revenues Variable costs: $ 439,600 Direct materials $ 56,800 92,400 Direct labor 41,600 Variable manufacturing overhead Variable selling and administrative expenses 30,800 221,600 218,000 Fixed manufacturing overhead Fixed selling and administrative expenses 52,000 Net income $ 166,000
