Sims Company, a manufacturer of tablet computers, began operations on January 1, 2017. Its cost and...

90.2K

Verified Solution

Question

Accounting

Sims Company, a manufacturer of tablet computers, beganoperations on January 1, 2017. Its cost and sales information forthis year follows. Manufacturing costs Direct materials $ 40 perunit Direct labor $ 60 per unit Overhead costs for the yearVariable overhead $ 4,400,000 Fixed overhead $ 6,600,000 Sellingand administrative costs for the year Variable $ 750,000 Fixed $4,250,000 Production and sales for the year Units produced 110,000units Units sold 80,000 units Sales price per unit $ 350 perunit
1. Prepare an income statement for the year using variablecosting. 2. Prepare an income statement for the year usingabsorption costing. 3. Under what circumstance(s) is reportedincome identical under both absorption costing and variablecosting?

Answer & Explanation Solved by verified expert

4.4 Ratings (889 Votes)

SOLUTION 1 Income statement for the year using variable costing Particulars Amount Amount Sales 80000350 28000000 Less Variable costs Direct material 8000040 3200000 Direct labor 8000060 4800000 Variable overhead costs See Answer

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:

Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!

Become a Member