Question

please fill out the rest of a, b, and c

Variable and Absorption Costing Summarized data for 2016 (the first year of operations) for Gorman Products, Inc., are as follows: Sales (75,000 units) $6,000,000 Production costs (80,000 units) Direct material 1,760,000 Direct labor 1,440,000 Manufacturing overhead: Variable 1,088,000 Fixed 640,000 Operating expenses: Variable 336,000 Fixed 480,000 Depreciation on equipment 120,000 Real estate taxes 36,000 Personal property taxes (inventory & equipment) 57,600 Personnel department expenses 60,000 a. Prepare an income statement based on full absorption costing. Only use a negative sign with your answer for net income (loss), if the answer represents a net loss. Oth answers to the nearest whole number, when applicable. Absorption Costing Income Statement Sales $ 6,000,000

Answer 1

Absorption Costing Income Statement Sales $6,000,000 Cost of Goods Sold: Beginning Inventory $ Direct Materials $1,760,000 Direct Labour $1,440,000 Manufacturing Overhead $1,728,000 Less : Ending Inventory $ 308,000 Cost of Goods Sold $4,620,000 Gross Profit $ 1,380,000 Operating Expense $1,089,600 Net Income (Loss) $ 290,400 Working Total Manufacturing Cost for 80,000 units Cost of Ending Inventory of 5,000 units Operating Expenses $4,928,000 ($1,760,000 + $1,440,000+ $1,728,000) $ 308,000 $4,928,000 / 80,000 units) * 5000 Units $1,089,600 $336,000+$480,000+$120,000+$36,000+$57,600+$60,000 b Variable Costing Income Statement Sales $6,000,000 Variable Cost of Goods Sold: Beginning Inventory $ Direct Materials $ 1,760,000 Direct Labour $1,440,000 Variable Manufacturing Overhead $ 1,088,000 Less: Ending Inventory $ 268,000 Variable Cost of Goods Sold $4,020,000 Variable Operating Expenses $ 336,000 Contribution Margin $1,644,000 Fixed Costs: Manufacturing Overheads $ 640,000 Operating Expense $ 753,600 Total Fixed Cost $ 1,393,600 Net Income (Loss) $ 250,400 Working Total Variable Manufacturing Cost for 80,000 units Variable Cost of Ending Inventory of 5,000 units Operating Expenses : Variable Fixed $4,288,000 ($1,760,000+ $1,440,000+ $1,088,000) $ 268,000 ($4,288,000 / 80,000 units) * 5000 Units $ 336,000 $ 753,600 $480,000+$120,000+$36,000+$57,600+$60,000 с $4,356,000 for 75,000 units $ 58.08 Per unit Total Variable Cost from above table Total Variable cost per unit For Special order of 1,000 units Sales price per unit Less : Total Variable cost per unit Contribution per Unit Total Contribution for 1000 units $ $ $ $ 60.00 58.08 1.92 1,920 Profit d Option A Note: Please Comment down for any further clarifications.