Santana Rey expects sales of Business Solutions' line of computer workstation furniture to equal 300 workstations (at a sales price of $3,900 each) for 2021 . The workstations' manufacturing costs include the following Selling and administrative expenses for these workstations follow. Santana is conisidering how many workstations to produce in 2021 . She is confident that she will be able to sell any workstations in her 2021 ending inventory during 2022 . However, Santana does not want to overproduce as she does not have sufficient storage space for many more workstations. Required: 1. Complete the following income statements using absorption costing. 2. Complete the following income statements using varlable costing. 3. Which costing method, absorption or variable, ylelds the higher income when 320 workstations are produced and 300 are sold? Complete this question by entering your answers in the tabs below. Complete the following income statements using absorption costing. Complete the following income statements using absorption costing. \begin{tabular}{|c|c|c|c|c|} \hline \multirow{3}{*}{Productcostperunit-AbsorptioncostingDirectmaterialsperunit} & \multicolumn{4}{|c|}{ Production volume } \\ \hline & \multicolumn{2}{|c|}{300workstations} & \multicolumn{2}{|c|}{320workstations} \\ \hline & $ & 710 & $ & 710 \\ \hline Direct labor per unit & & 340 & & 340 \\ \hline Variable overhead per unit & & 80 & & 80 \\ \hline \multicolumn{5}{|l|}{ Fixed overhead per unit } \\ \hline Product cost per unit - Absorption costing & $ & 1,130 & $ & 1,130 \\ \hline Number of workstations sold & & 300 & & 300 \\ \hline Total cost of goods sold & $ & 339,000 & $ & 339,000 \\ \hline \multicolumn{5}{|l|}{ BUSINESS SOLUTIONS } \\ \hline \multicolumn{5}{|c|}{ Income Statements (Absorption Costing) } \\ \hline & \multicolumn{4}{|c|}{ Production volume } \\ \hline Sales volume -300 Workstations & & 300kstations & & 320istations \\ \hline \multicolumn{5}{|l|}{ Sales } \\ \hline \multicolumn{5}{|l|}{ Cost of goods sold } \\ \hline Gross profit & & + & & 0 \\ \hline \multicolumn{5}{|l|}{ Selling and administrative expenses } \\ \hline Income & $ & 0 & $ & \\ \hline \end{tabular} fomnlate tha followinn income statements using variable costing. (o) What is the contribution margin from accepting the offer? (b) Should the offer be accepted or rejected? Complete this question by entering your answers in the tabs below. What is the contribution margin from accepting the offer? (Note: A negative contribution margin should be entered as a negative number and will appear in parentheses.)
