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Estimated Income Statements, using Absorption and Variable Costing Prior to the first month of...

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Accounting

Estimated Income Statements, using Absorption and Variable Costing
Prior to the first month of operations ending October 31, Marshall Inc. estimated the following operating results:
Sales (18,400$63)
$1,159,200
Manufacturing costs (18,400 units):
\table[[Direct materials,699,200],[Direct labor,165,600],[Variable factory overhead,77,280],[Fixed factory overhead,92,000],[Fixed selling and administrative expenses,25,000],[Variable selling and administrative expenses,30,300]]
The company is evaluating a proposal to manufacture 20,000 units instead of 18,400 units, thus creating an ending inventory of 1,600 units. Manufacturing the additional units will not change sales, unit variable factory overhead costs, total fixed factory overhead cost, or total selling and administrative expenses.
a.1. Prepare an estimated income statement, comparing operating results if 18,400 and 20,000 units are manufactured in the absorption costing format. If an amount box does not require an entry leave it blank.
Marshall Inc.
Absorption Costing Income Statement
For the Month Ending October 31
Cost of goods sold:
18,400 Units Manufactured 20,000 Units Manufactured
$ $
$
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