Absorption and Variable Costing Income StatementsDuring the first month of operations ended July 31,...

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Accounting

Absorption and Variable Costing Income Statements
During the first month of operations ended July 31, YoSan Inc.manufactured 11,900 flat panel televisions, of which 10,900 weresold. Operating data for the month are summarized as follows:
Sales $1,798,500
Manufacturing costs:
    Direct materials $928,200
    Direct labor 273,700
    Variable manufacturing cost 238,000
    Fixed manufacturing cost 119,000 1,558,900
Selling and administrative expenses:
    Variable $141,700
    Fixed 65,200 206,900
Required:
1. Prepare an income statement based on theabsorption costing concept.
YoSan Inc.
Absorption Costing Income Statement
For the Month Ended July 31
Sales $
Cost of goods sold:
Cost of goods manufactured $
Inventory, July 31
$
$
2. Prepare an income statement based on thevariable costing concept.
YoSan Inc.
Variable Costing Income Statement
For the Month Ended July 31
$
Variable cost of goods sold:
$
$
$
Fixed costs:
$
$
3. Explain the reason for the difference in theamount of income from operations reported in (1) and (2).
The income from operations reportedunder   costing exceeds the income from operationsreported under costing by the difference between the two, dueto   manufacturing costs that are deferred to afuture month under   costing.

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In: AccountingAbsorption and Variable Costing Income StatementsDuring the first month of operations ended July 31, YoSan...Absorption and Variable Costing Income StatementsDuring the first month of operations ended July 31, YoSan Inc.manufactured 11,900 flat panel televisions, of which 10,900 weresold. Operating data for the month are summarized as follows:Sales$1,798,500Manufacturing costs: Direct materials$928,200 Direct labor273,700 Variable manufacturing cost238,000 Fixed manufacturing cost119,0001,558,900Selling and administrative expenses: Variable$141,700 Fixed65,200206,900Required:1. Prepare an income statement based on theabsorption costing concept.YoSan Inc.Absorption Costing Income StatementFor the Month Ended July 31Sales$Cost of goods sold:Cost of goods manufactured$Inventory, July 31$$2. Prepare an income statement based on thevariable costing concept.YoSan Inc.Variable Costing Income StatementFor the Month Ended July 31$Variable cost of goods sold:$$$Fixed costs:$$3. Explain the reason for the difference in theamount of income from operations reported in (1) and (2).The income from operations reportedunder costing exceeds the income from operationsreported under costing by the difference between the two, dueto manufacturing costs that are deferred to afuture month under costing.

Sales		$1,798,500
Manufacturing costs:
Direct materials	$928,200
Direct labor	273,700
Variable manufacturing cost	238,000
Fixed manufacturing cost	119,000	1,558,900
Selling and administrative expenses:
Variable	$141,700
Fixed	65,200	206,900

YoSan Inc.
Absorption Costing Income Statement
For the Month Ended July 31
Sales		$
Cost of goods sold:
Cost of goods manufactured	$
Inventory, July 31

		$

		$

YoSan Inc.
Variable Costing Income Statement
For the Month Ended July 31
		$
Variable cost of goods sold:
	$


		$

		$
Fixed costs:
	$


		$