S 18-26B (Algo) Absorption costing income statement LO P4 Aces Incorporated, a manufacturer of tennis rackets, began operations this year. The company produced 6,300 rackets and sold 5,200. Each racket was sold at a price of $93. Fixed overhead costs are $83,790 for the year, and fixed selling and administrative costs are $65,500 for the year. The company also reports the following per unit variable costs for the year: Direct materials. Direct labor Variable overhead. Variable selling and administrative expenses Required: Prepare an income statement under absorption costing. ACES INCORPORATED Income Statement (Absorption Costing) Sales $ 483,600 Cost of goods sold Gross profit $ 483,600 Selling and administrative expenses Income $ 267,450 $12.09 8.09 5.12 2.30 Aces Incorporated, a manufacturer of tennis rackets, began operations this year. The company produced 6,800 rackets and sold 5,700. Each racket was sold at a price of $98. Fixed overhead costs are $93,840 for the year, and fixed selling and administrative costs are $66,000 for the year. The company also reports the following per unit variable costs for the year. Direct materials Direct labor Variable overhead Variable selling and administrative expenses Required: Prepare an income statement under variable costing. ACES INCORPORATED $ 12.24 8.24 5.32 2.80 Sales Variable expenses Variable Costing Income Statement $ 558,600 Variable cost of goods sold $ 147,060 Variable selling and administrative expenses 15,960 163,020 395,580 Contribution margin Fixed selling and administrative costs $ 66,000 Fixed overhead 93,840 Income (loss) of 17 159,840 $ 235,740 Next >