Z This part ofthe question is not part of your Connect assignment. 3. During the second month of operations, the company again produced 52,200 units but sold 63,000 units. {Assume no change in total fixed costs.) .9. Prepare a contribution format income statement for the month using variable costing. Sales 9 $ 403.200 0 Variable expenses: Variable cost of goods sold a $ 23.310 9 Variable selling and administrative expenae 0 r3.r10 0 93.020 Contribution margin 9 305.100 Fixed expenses: Fixed manufacturing overhead 0 90,828 a Fixed selling and administrative expense 0 14.490 0 105.313 6 $ 200.862 *Red text indicating no response was expected in a cell or a formula-based calculation is inoorrect; no points deducted. b. Prepare an income statement for the month using absorption costing. {Do not leave any empty spaces; input a O wherever it is required.) Sales .1; 403.200 9 Cost of goods sold: Cost of goods sold Add: Cost of goods manufactured Cost of goods sold Less: Ending inventory 9.4TD.TBU Gross margin (9. 051590} Selling and administrative expenses 38,200 0 Operating loss $(9:155]9m Red text indicaos no response was expected in a cell or a formula-based calculation is inoorrect; no points deducted. Leander Ofce Products Inc. produces and sells small storage and organizational products for office use. During the first month of operations, the products sold well. Andrea Leander, the owner ofthe company, was surprised to see a loss forthe month on her income statement. This statement was prepared by a local bookkeeping service recommended to her by her bank manager. The statement follows: LEANDER OFFICE PRODUCTS INC. Income Statement Sales (41,466 units) $264,966 Variable expenses: Variable cost of goods sold* $125,684 Variable selling and administrative expenses 43.433 175.122 Contribution margin 89,833 Fixed expenses: Fixed manufacturing overhead 96,823 Fixed selling and administrative expenses 14,496 165,313 Operating loss $[1514892 \"Consists of direct materials, direct labour, and variable manufacturing overhead. Leander is discouraged over the loss shown for the month. particularly since she had planned to use the statement to encourage investors to purchase shares in the new company. A friend who is an accountant insists that the company should be using absorption costing rather than variable costing. He argues that ifabsorption costing had been used, the company would probably have reported a prot for the month. Selected cost data relating to the product and to the first month ofoperations follow: Units produced 52,266 Units sold 41,466 Variable costs per unit: Direct materials $ 1.4? Direct labour 5 1.22 Variable manufacturing overhead S 6.3? Variable selling and administrative expenses $ 1.1? Required: 1. Complete the following: :1. Compute the unit product cost under absorption costing. [Round your answer to 2 decimal places.) 150.336 it. Redo the company's income statement for the month using absorption costing. (Do not leave any empty spaces; input a D wherever it is required.} Sales 0 5 254,960 0 Cost of goods sold: Cost of goods sold a :5 5,223,562 9 Add: Cost of goods manufactured 9 E] 9 Cost of goods sold 0 6,223,662 Less: Ending inventory a 6 5,223,562 Gross margin 9 (5358.702) Selling and administrative expenses 9 52,928 9 Operating loss a 6. 021.53\" I'Red text indicat no response was expected in a cell or a formula-based calculation is inoorrect; no point: deducted. c. Reconcile the variable and absorption costing operating income {loss} figures. {Loss amounts should be entered with a minus sign.} Variable costing operating income (loss} 5: (15,430} 0 Add: Fixed manufacturing overhead cost deferred in inventory under absorption costing 1B,?92 9 Absorption costing operating income (loss) $ 3,312 c. Reconcile the variable costing and absorption costing operating income figures. l'ul'an'aiole costing operating income {loss} $(9,135,993} 9 Deducl: Fixed manufacturing overhead cost released from inirentorjlur under absorption costing {'1 3,192} 0 Absorption costing operating income [loss] $119: 155.?90} Red textindicat no response was expected in a cell or a formula-based calculation is incorrect; no points deducted