Selling price per unit 5 50.00 No Video for this worksheet 6 Manufacturing costs Variable per unit produced: 7 8 Direct materials REQUIRED Calculate the unit cost and prepare a traditional income statements using absorption costing. Calculate the unit cost and prepare a variable costing income statement. Check your work using the 11.00 9 Direct labor 6.00 10 Variable manufacturing overhead Fixed manufacturing overhead per year 3.00 120,000 11 12 Selling and administrative expenses 13 14 values on the check figure tab. Variable per unit sold Fixed per year 4.00 15 70,000 16 17 18 Year 1 Year 2 19 Units in beginning inventory Units produced during the year Units sold during the year 20 10,000 8,000 21 8,000 10,000 22 Units in ending inventory 23 24 25 Compute the cost per unit using Absorption Costing Compute the cost per unit using Variable Costing 26 Year 1 Year 2 Year 1 Year 2 27 Direct materials Direct materials Direct labor 28 Direct labor Variable manufacturing overhead 29 Variable manufacturing overhead 3C Fixed manufacturing overhead Variable costing unit product cost 31 Absorption costing unit product cost 32 Construct the Variable Costing Income Statement 33 Construct the Absorption Costing Income Statement Year 1 Year 2 Year 1 Year 2 34 Sales Sales 35 Cost of goods sold Gross Profit Cost of goods sold Gross margin 36 37 A B Absorption costing unit product cost Construct the Absorption Costing Income Statement Construct the Variable Costing Income Statement Year 2 Year 1 Year 1 Year 2 Sales Sales Cost of goods sold Gross margin Cost of goods sold Gross Profit Selling and administrative expenses Selling and administrative expenses Net operating income Net operating income Value of ending inventory Value of ending inventory Compare aborption costing with variable c0sting: How much higher is year 1 NOI under absorption costing? How much higher is the value of ending inventory? Why is the year 1 net income higher under absorption costing? What is the total two year net income under absorption costing? What is the total two year net income under variable costing