Selling price $108

Units in beginning inventory 0

Units produced 1100

Units sold 900

Units in ending inventory 200

Variable costs per unit:

Direct materials $28

Direct labor $30

Variable manufacturing overhead $7

Variable selling and administrative $11

Fixed costs:

Fixed manufacturing overhead $14,300

Fixed selling and administrative $1,800

1.Compute net income using the variable costing method

2.Compute net income using the absorption costing method

Corporate managers salaries $150,000

Division V managers salary $56,000

Division B managers salary $64,000

Maintenance-division A $9,000

maintenance-Division B $11,500

Office workers salaries-corporate headquarters $62,000

Corporate jet depreciation $70,000

Sales for division A 300,000

Variable expenses for division A 111,400

3. Compute the segment margin for division A?

4. Which costs are included as product costs under Variable Costing?

- Direct Materials

- Direct Labor

- Variable Overhead

- Fixed Overhead

- Variable Selling & Administrative

- Fixed Selling & Administrative