Question

W E9-22 (similar to) Accelerate Motors assembles and sells motor vehicles and uses standard costing. Actual data and variable costing and absorption costing income statements relating to April and May 2017 are as follows: (Click the icon to view the data.) The variable manufacturing costs per unit of Accelerate Motors are as follows: (Click the icon to view the variable manufacturing costs per unit.) (Click the icon to view the variable costing income statements.) Read the requirements (Click the icon to view the absorption costing income statements.) Requirement 1. Prepare income statements for Accelerate Motors in April and May 2017 under throughput costing. Begin by completing the top portion of the statement, then the bottom portion. (Complete all answer boxes. Enter a "0" for any zero amounts.) April 2017 May 2017 Revenues

EXAMPLE OF THE TEMPLATE NEEDED:

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Answer 1

Under Throughput Costing April 2017 May 2017 13,650,000 (525*26000) 10,400,000 (7200 *450) Revenues (400*26000) Direct Material Cost of Goods Sold Beginning Inventory Direct Materials (7200*500) Cost of Goods Available for Sale Deduct Ending Inventory (7200*100) Total Direct Material Cost of Goods Sold Throughput Margin Manufacturing Costs (1400+900)*500+2200000 Other Operating Costs (400*2800) +675000 Operating Income 3,600,000 3,600,000 (720,000) 720,000 3,240,000 3,960,000 (180,000) 2,880,000 7,520,000 3,350,000 1,795,000 2,375,000 (7200*25) 3,780,000 9,870,000 3,235,000 (1400+900) *450+2200000 2,145,000 (525*2800) +675000 4,490,000 Requirement 2 In April throughput costing has the lowest opeating income, whereas in May throughput costing has the highest operating income.Throughput costing puts greater emphasis on sales as the source of operating income than does either absorption or variable costing

Requirement 3 98 Throughput costing puts a penalty on production without a coresponding sale in the same period. Costs other than direct materials that are variable with respect to production are expensed in the period of incurrence.whereas under variable costing they would be capitalized . As a result, throughput costing provides less incentive to produce for inventory than either absorption or variable costing. 99 100