U E - C Problem 3 Walsh company provided following information for August Beginning inventory, August 1 Units produced during August Units sold during August Selling price per unit 5,000 units 30,000 units 28,000 units $75 per unit The cost information for August are as follows: Total costs Number of units Unit cost 110,000 50,000 160,000 5,000 5,000 22 10 32) Beginning Inventory: Manufacturing costs Variable Fixed Total Current Period: Manufacturing costs Variable Fixed Total Selling and Admin Expenses Variable Fixed Total 750,000 450,000 1,200,000 30,000 30,000 25 15 40 28,000 8 224,000 160,000 384,000 Dale Siddique, Salina: COGS = BI + COGM - EI $ 2,100,000 Solution: A. Absorption Costing Income Statement Sales Costs of Goods Sold Beginning inventory Plus, Costs of Goods Manufactured Less Ending Inventory Total Costs of Goods Sold Gross Profit less Selling and Administrative expenses Income from Operation 160,000 1,200,000 280.000 Siddique, Salina: Ending inventory units = BI+ Units Produced Units sold -5,000 + 30,000 - 28,000 - 7,000 units 1.080,000 1,020,000 384.000 636.000 $ $ 2,100,000 110,000 750,000 175.000 B. Variable Costing Income Statement Sales Variable costs of Goods Sold Beginning inventory Variable Manufacturing costs less Ending Inventory Total Variable COGS Manufacturing Margin Less Variable Selling and Administrative Expenses Contribution margin Less Fixed costs Fixed manufacturing costs Fixed Selling and Administrative expenses Total Fixed costs Income from Operation 685.000 1,415,000 224,000 1,191,000 450,000 160.000 610,000 581.000