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Required information [The following information applies to the questions displayed below.] Oak Mart, a producer of solid oak...

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Accounting

Required information

[The following information applies to the questionsdisplayed below.]

Oak Mart, a producer of solid oak tables, reports the followingdata from its second year of business.

Sales price per unit$320per unit
Units produced this year115,000units
Units sold this year118,250units
Units in beginning-year inventory3,250units
Beginning inventory costs
Variable (3,250 units × $135)$438,750
Fixed (3,250 units × $80)260,000
Total$698,750
Manufacturing costs this year
Direct materials$42per unit
Direct labor$64per unit
Overhead costs this year
Variable overhead$3,400,000
Fixed overhead$7,400,000
Selling and administrative costs this year
Variable$1,500,000
Fixed4,000,000

2. Prepare the current-year income statementfor the company using absorption costing.

OAK MART COMPANY
Absorption Costing IncomeStatement
Beginning inventory
Manufacturing costs this year
Net income (loss)
Fixed costs addedto(subtracted from) inventory

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