This Question: 10 pts 17 of 45 (13 complete) This Test: 120 pts possible The annual data that follow pertain to Sea Shades, a manufacturer of swimming goggles. (Sea Shades had no beginning inventories.) 2 (Click the icon to view the data.) Requirements 1. Prepare both conventional (absorption costing) and contribution margin (variable costing) income statements for Sea Shades for the year. 2. Which statement shows the higher operating income? Why? Reconcile the difference between the two 3. Sea Down There's marketing vice-president believes a new sales promotion that costs $160,000 would increase sales to 230,000 goggles. Should the company go ahead with the promotion? Give your reason. Begin with the conventional (absorption costing) income statement. (For entries with a zero balance, make sure to enter "0" in the appropriate cell.) statements Sea Shades Conventional (Absorption Costing) Income Statement For the Year Ended December 31 Operating income Choose from any list or enter any number in the input fields and then continue to the next question o no Data Table - follow pertain to Sea 3.) to view the data.) ents for $ ventional (absorption me year. shows the higher opel 42 15 ncrease s marketing vice-pres Soggles. Should the 5 Sale price.. Variable manufacturing expense per unit Sales commission expense per unit .... Fixed manufacturing overhead Fixed operating expenses Number of goggles produced Number of goggles sold ---- 2.760,000 250,000 entional (absorption appropriate cell.) e sure 230,000 Sea Shal 215,000 onal (Absorption Co For the Year Ended Print Done list or enter any number in the input fields and then continue to the next question. 0 The annual data that follow pertain to Sea Shades, a manufacturer of swimming goggles. (Sea Shades had no eginning inventories.) (Click the icon to view the data.) Requirements 1. Prepare both conventional (absorption costing) and contribution margin (variable costing) income statements for Sea Shades for the year. 2. Which statement shows the higher operating income? Why? Reconcile the difference between the two statements. 3. Sea Down There's marketing vice-president believes a new sales promotion that costs $160,000 would increase sales to 230,000 goggles. Should the company go ahead with the promotion? Give your reason. Contribution Margin (Variable Costing) Income Statement For the Year Ended December 31 Sales revenue Variable expenses Variable cost of goods sold: Fixed expenses Operating income Choose from any list or enter any number in the input fields and then continue to the next question. ook Air this Question: 10 pts 17 of 45 (13 complete) This Test: 120 pts possible The annual data that follow pertain to Sea Shades, a manufacturer of swimming goggles. (Sea Shades had no beginning inventories.) (Click the icon to view the data.) Requirements 1. Prepare both conventional (absorption costing) and contribution margin (variable costing) income statements for Sea Shades for the year. 2. Which statement shows the higher operating income? Why? Reconcile the difference between the two statements. 3. Sea Down There's marketing vice-president believes a new sales promotion that costs $160,000 would increase sales to 230,000 goggles. Should the company go ahead with the promotion? Give your reason. Requirement 2. Which statement shows the higher operating income? Why? Reconcile the difference between the two statements. Absorption costing operating income is variable costing operating income. This is because absorption costing defers of fixed manufacturing overhead as an asset in ending inventory. In contrast, variable costing expenses the fixed manufacturing overhead during the year. Variable costing expenses $ costs during the year, so variable costing operating income is $|| than absorption costing income during the year Reconcile the difference between the two statements. (For entries with a zero balance, make sure to enter "" in the appropriate cell. Abbreviation used: FMOH = fixed manufacturing overhead.) Absorption costing net income Add: FMOH released from inventor Loss: FMOH deferred to El Variable costing net income Requirement 3. Sea Down There's marketing vice-president believes a new sales promotion that costs $160,000 would increase sales to 230,000 goggles. Should the company go ahead with the promotion? Give your reason. Use the contribution margin income statement format to evaluate the sales promotion Choose from any list or enter any number in the input fields and then continue to the next question. ook Air The annual data that follow pertain to Sea Shades, a manufacturer of swimming goggles. (Sea Shades had no beginning inventories.) (Click the icon to view the data.) Requirements 1. Prepare both conventional (absorption costing) and contribution margin (variable costing) income statements for Sea Shades for the year. 2. Which statement shows the higher operating income? Why? Reconcile the difference between the two statements. 3. Sea Down There's marketing vice-president believes a new sales promotion that costs $160,000 would increase sales to 230,000 goggles. Should the company go ahead with the promotion? Give your reason. the year. Reconcile the difference between the two statements. (For entries with a zero balance, make "0" in the appropriate cell. Abbreviation used: FMOH = fixed manufacturing overhead.) Absorption costing net income Add: FMOH released from inventory Less: FMOH deferred to El Variable costing net income Requirement 3. Sea Down There's marketing vice-president believes a new sales promotion that costs $160,000 would increase sales to 230,000 goggles. Should the company go ahead with the promotion? Give your reason. Use the contribution margin income statement format to evaluate the sales promotion Increase in contribution margin Increase in foxed expenses tre to Increase in operating income Sea Shades with the promotion because the increase in contribution margin the increase in fixed costs Choose from any list or enter any number in the input fields and then continue to the next question 2 Book Air