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The 2018 data that follow pertain to Als Awesome Eyewear, a manufacturer of swimming goggies. (Als Awesome Eyewear had no beginning Finished Goods Inventory in
The 2018 data that follow pertain to Als Awesome Eyewear, a manufacturer of swimming goggies. (Als Awesome Eyewear had no beginning Finished Goods Inventory in January 2018.) (Click the icon to view the data.) Read the requirements Requirement 1. Prepare both conventional (absorption costing) and contribution margin (variable costing) income statements for Ars Awesome Eyewear for the year ended December 31, 2018. (Round intermediary calculations to the nearest cent.) Begin by preparing Ars Awesome Eyewear's conventionat (absorption costing) income statement for the year ended December 31, 2018, Al's Awesome Eyewear Income Statement (Absorption Costing) Year Ended December 31, 2018 Data table x 140.000 Number of goggles produced Number of goggles sold Sales price per unit Variable manufacturing cost per unit Sales commission cost per unit Fixed manufacturing overhead Fixed selling and administrative costs 305,000 25 7 Operating Income 4 980.000 170.000 - X Requirements Done 1. Prepare both conventional (absorption costing) and contribution margin (variable costing) income statements for Ars Awesome Eyewear for the year ended December 31, 2018 2. Which statement shows the higher operating income? Why? 3. Al's Awesome Eyewear's marketing vice president believes a new sales promotion that costs $70,000 would increase sales to 115,000 goggles Should the company go ahead with the promotion? Give your reasoning. Print Done
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