Waltman Company provided the following data for their metal brackets:

Units in beginning finished goods inventory900Cost per unit?Units produced60,000Units sold ($13.50 per unit)56,000Variable costs per unit produced:Direct materials$1.80Direct labor0.90Variable overhead0.30Variable selling expenses (per unit sold)$0.10Fixed costs:Fixed overhead incurred$216,000Fixed selling and administrative$72,000

Required:

Using variable costing, answer the following:

1. Calculate the per-unit product cost (round to the nearest cent):

2. Calculate the units in ending finished goods inventory:

3. Calculate the cost of ending finished goods (round to the nearest dollar):

4. Answer the following:

Waltman Company

Variable-Costing Income Statement

Sales

Less variable expenses:

Variable cost of goods sold

Variable selling and administrative expenses

Contribution margin

Less fixed expenses

Fixed overhead

Fixed selling and administrative

Operating Income

Scenario 3

Reconcile the income using the variable costing versus absorption costing as calculated above:

Operating Income using Variable Costing:

Fixed Overhead in Opening Inventory:

Fixed Overhead in Ending Inventory:

Change in fixed overhead:

Operating income using Absorption Costing:

Fixed Overhead in opening Inventory =

Fixed Overhead in ending inventory =