RZM Industries Inc. Income Statement-Solvent For the Month Ended April 30 $500,000.00 1 Sales (4,000 units) 424,000.00 2 Cost of goods sold $76,000.00 3 Gross profit 102,000.00 4 Selling and administrative expenses $(26,000.00) 5 Loss from operations The production costs and selling and administrative expenses, based on production of 4,000 units in April, are as follows: Direct materials $45 per unit 20 per unit Direct labor 16 per unit Variable manufacturing cost Variable selling and administrative expenses Fixed manufacturing cost Fixed selling and administrative expenses 15 per unit $100,000 for April 42,000 for April Sales for May are expected to drop about 20% below those of the preceding month. No significant changes are anticipated in the fixed costs of variable costs per unit. No extra costs will be incurred in discontinuing operations in the portion of the plant associated with solvent. The inventory of solwent at the beginning and end of May is expected to be inconsequential Required: 1. Prepare an estimated income statement in absorption costing form for May for soment, assuming that production continues during the month Round amounts to two decimals. 2. Prepare an estimated income statement in variable costing form for May for solvent, assuming that production continues during the month Round amounts to two decimals. 3. What would be the estimated loss in income from operations the solvent production were temporary suspended for May?' a loss is incurred, enter that amount as a negative number using a minus sign 4. What advice should the controller give to management? *Refer to the lists of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. Be sure to complete the statement heading. A colon () will automatically appear as it is required a ner loss is incurred, enter that amount as a negative number using a minus sign Labels Cost of goods sold Fixed costs For the Month Ending May 31 May 31 Selling and administrative expenses Variable cost of goods sold Amount Descriptions Contribution margin Contribution margin ratio Direct labor Direct materials Fixed manufacturing cost Fixed selling and administrative expenses Gross profit Income from operations Loss from operations Manufacturing margin Planned contribution margin Sales Sales mix Total cost of goods sold Total fixed costs Total selling and administrative expenses Total variable cost of goods sold 1. Prepare an estimated income statement in absorption costing form for May for solvent, assuming that production continues during the month. Round amounts to two the list of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. Be sure to complete the statement heading. A colon () will autor is required. It a net loss is incurred, enter that amount as a negative number using a minus sign RZM Industries Inc Estimated Income Statement--Absorption Costing-Solvent (Labely 1 Label 1 Label 10 11 12 11 RZM Industries Inc. Estimated Income Statement-Variable Costing-Solvent (Label) 1 2. (Label 3 5 6 7 8 9 10 (Label) 11 12 13 14 3. What would be the estimated loss in income from operations if the solvent production were temporarily suspended for May it a loss is incurred, enter that amount as a negative number using a minus sign