Aces Inc., a manufacturer of tennis rackets, began operations this year. The company produced 6,000 rackets and sold 4,900. Each racket was sold at a price of $90. Fixed overhead costs are $78,000, and fixed selling and administrative costs are $65,200. The company also reports the following per unit variable costs for the year: Variable product costs Variable selling and administrative expenses $25.00 $ 2.00 Prepare an income statement under absorption costing. ACES INC. Absorption Costing Income Statement Sales 24 441,000 Less: Cost of goods sold Variable production costs 122,500 Fixed overhead costs Cost of goods sold Gross margin 122,500 Selling general and administrative expenses
Aces Inc., a manufacturer of tennis rackets, began operations this year. The company produced 6,000 rackets and sold 4,900. Each racket was sold at a price of $90. Fixed overhead costs are $78,000, and fixed selling and administrative costs are $65,200. The company also reports the following per unit variable costs for the year: Variable product costs Variable selling and administrative expenses $25.00 $ 2.00 Prepare an income statement under absorption costing. ACES INC. Absorption Costing Income Statement Sales 24 441,000 Less: Cost of goods sold Variable production costs 122,500 Fixed overhead costs Cost of goods sold Gross margin 122,500 Selling general and administrative expenses
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter7: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 62P
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