Please do not give solution in image format thanku During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows:Year 2$1,680,000Sales (@$60 per unit)Cost of goods sold (@ $30 per unit)Gross marginSelling and administrative expensesNet operating income.*$3 per unit variable: $247,000 fixed each year.The company's $30 unit product cost is computed as follows:Year 1$ 1,080,000540,000540,000301,000$ 239,000Direct materials:Direct laborVariable manufacturing overheadiFixed manufacturing overhead ($253,000+ 23,000 units)Absorption costing unit product costProduction and cost data for the first two years of operations are:Year 2123,00028,000Units producedUnits soldYear 123,00018,000840,000840,000331,000$ 509,000$710211$ 30 Required 1Required 2 Required 3Using variable costing, what is the unit product cost for both years?Unit product costRequired 1 Requited 2What is the variable costing net operating income in Year 1 and in Year 27 (Loss amounts should be indicated with a minussign.)Net operating income (loss)Required 1 Required 2Required 31Year 1Year 2Required 3Reconcile the absorption costing and the variable costing net operating income figures for each year.Reconciliation of Variable Costing and Absorption Costing Net Operating IncomesYear 1Required 2Variable costing net operating income (foss)Add (deduct) fixed manufacturing overhead deferred in (released from) inventory underabsorption costingAbsorption costing net operating income< Required 2Year 2

The costs can be classified as variable and fixed. The variable cost is the cost that directly…

During Heaton Company's first two years of operations, it reported absorption costing net operating income as follo Sales (@$60 per unit) Cost of goods sold (@ $30 per unit) Gross margin Selling and administrative expenses* Net operating income Year 1 Year 2 $ 1,080,000 $1,680,000 540,000 540,000 301,000 $ 239,000 *$3 per unit variable; $247,000 fixed each year. The company's $30 unit product cost is computed as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead ($253,000+ 23,000 units) Absorption costing unit product cost Production and cost data for the first two years of operations are: Year 1 22 000 Year 2 23.000 840,000 840,000 331,000 $509,000 $7 10 2 11 $ 30

During Heaton Company's first two years of operations, it reported absorption costing net operating income as follo Sales (@$60 per unit) Cost of goods sold (@ $30 per unit) Gross margin Selling and administrative expenses* Net operating income Year 1 Year 2 $ 1,080,000 $1,680,000 540,000 540,000 301,000 $ 239,000 *$3 per unit variable; $247,000 fixed each year. The company's $30 unit product cost is computed as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead ($253,000+ 23,000 units) Absorption costing unit product cost Production and cost data for the first two years of operations are: Year 1 22 000 Year 2 23.000 840,000 840,000 331,000 $509,000 $7 10 2 11 $ 30

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

Chapter3: Cost Behavior And Cost Forecasting

Section: Chapter Questions

Problem 54E: Income Statements under Absorption and Variable Costing In the coming year, Kalling Company expects...

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