Homework Help is Here – Start Your Trial Now!
Business
Accounting
Hayek Bikes prepares the income statement under variable costing for its managerial reports, and it prepares the income statement under absorption costing for external reporting. For its first month of operations, 375 bikes were produced and 225 were sold; this left 150 bikes in ending inventory. The income statement information under variable costing follows. Sales (225 x $1,600) Variable product cost (225 x $625) Variable selling and administrative expenses (225 x $65) $ 360,000 Contribution margin Fixed overhead cost Fixed selling and administrative expense 140,625 14,625 204,750 56,250 75,000 Net income $ 73,500 1. Prepare this company's income statement for its first month of operations under absorption costing. 2. Fill in the blanks:

Hayek Bikes prepares the income statement under variable costing for its managerial reports, and it prepares the income statement under absorption costing for external reporting. For its first month of operations, 375 bikes were produced and 225 were sold; this left 150 bikes in ending inventory. The income statement information under variable costing follows. Sales (225 x $1,600) Variable product cost (225 x $625) Variable selling and administrative expenses (225 x $65) $ 360,000 Contribution margin Fixed overhead cost Fixed selling and administrative expense 140,625 14,625 204,750 56,250 75,000 Net income $ 73,500 1. Prepare this company's income statement for its first month of operations under absorption costing. 2. Fill in the blanks:

Managerial Accounting
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter7: Variable Costing For Management analysis
Section: Chapter Questions
Problem 8E: Estimated income statements, using absorption and variable costing Prior to the first month of...
See similar textbooks
icon
Related questions
Question

Can you please check my work

Hayek Bikes prepares the income statement under variable costing for its managerial reports, and it prepares the income statement under absorption costing for external reporting. For its first month of operations, 375 bikes were produced and 225 were sold; this left 150 bikes in ending inventory. The income statement information under variable costing follows. Sales (225 x $1,600) Variable product cost (225 Variable selling and administrative expenses ( 225 x $65) Contribution margin $ 360,000 140,625 $625) 14,625 204,750 Fixed overhead cost 56,250 75,000 $ 73,500 Fixed selling and administrative expense Net income 1. Prepare this company's income statement for its first month of operations under absorption costing. 2. Fill in the blanks: Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare this company's income statement for its first month of operations under absorption costing. HAYEK BIKES
Transcribed Image Text:Hayek Bikes prepares the income statement under variable costing for its managerial reports, and it prepares the income statement under absorption costing for external reporting. For its first month of operations, 375 bikes were produced and 225 were sold; this left 150 bikes in ending inventory. The income statement information under variable costing follows. Sales (225 x $1,600) Variable product cost (225 Variable selling and administrative expenses ( 225 x $65) Contribution margin $ 360,000 140,625 $625) 14,625 204,750 Fixed overhead cost 56,250 75,000 $ 73,500 Fixed selling and administrative expense Net income 1. Prepare this company's income statement for its first month of operations under absorption costing. 2. Fill in the blanks: Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare this company's income statement for its first month of operations under absorption costing. HAYEK BIKES
Required 1 Required 2 Prepare this company's income statement for its first month of operations under absorption costing. HAYEK BIKES Absorption Costing Income Statement Sales $ 360,000 Less: Cost of goods sold Variable product costs $ 140,625 Fixed overhead costs Cost of goods sold Gross margin 140,625 Selling general and administrative expenses Variable selling and administrative expenses 14,625 Fixed selling and administrative costs 75,000 Total selling general and administrative expenses 89,625 Net income (loss) Net income under absorption costing is higher than net income under variable costing by: 89,625 Number of units added to(subtracted from) inventory %24
Transcribed Image Text:Required 1 Required 2 Prepare this company's income statement for its first month of operations under absorption costing. HAYEK BIKES Absorption Costing Income Statement Sales $ 360,000 Less: Cost of goods sold Variable product costs $ 140,625 Fixed overhead costs Cost of goods sold Gross margin 140,625 Selling general and administrative expenses Variable selling and administrative expenses 14,625 Fixed selling and administrative costs 75,000 Total selling general and administrative expenses 89,625 Net income (loss) Net income under absorption costing is higher than net income under variable costing by: 89,625 Number of units added to(subtracted from) inventory %24
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps with 1 images

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Personal Financial Statements
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Managerial Accounting
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Principles of Cost Accounting
Principles of Cost Accounting
Accounting
ISBN:
9781305087408
Author:
Edward J. Vanderbeck, Maria R. Mitchell
Publisher:
Cengage Learning
Cornerstones of Cost Management (Cornerstones Ser…
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Managerial Accounting: The Cornerstone of Busines…
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
Principles of Accounting Volume 2
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
Financial And Managerial Accounting
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,
SEE MORE TEXTBOOKS