Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. whitman company has just completed its first year

Whitman Company has just completed its first year of operations. The company's absorption costing income...

50.1K

Verified Solution

Question

Accounting

image

Whitman Company has just completed its first year of operations. The company's absorption costing income statement for the year follows: Whitman Company Income Statement Sales (42,000 units x $42.10 per unit) Cost of goods sold (42,000 units x $24 per unit) Gross margin Selling and administrative expenses Net operating income $1,768,200 1,008,000 760,200 483,000 $ 277,200 The company's selling and administrative expenses consist of $315,000 per year in fixed expenses and $4 per unit sold in variable expenses. The $24 unit product cost given above is computed as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead ($245,000 = 49,000 units) Absorption costing unit product cost $ 11 5 3 5 $ 24 Required: 1. Redo the company's income statement in the contribution format using variable costing. 2. Reconcile any difference between the net operating income on your variable costing income statement and the net operating income on the absorption costing income statement above

Answer & Explanation Solved by verified expert
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

Other questions asked by students

Finance
1.2K views

Question 6: ABC Co. is considering replacing an old computer with a new one. The old...

Finance
1.2K views

How is maximizing sharholders wealth good for society?

Biology
1.2K views

Effective communication is key to increasing awareness of your brand products and services Digital communication...

Statistics
1.2K views

0 126 Question 2 Based on these results what can you conclude Use an alpha...

Statistics
1.2K views

Use the given data set to complete parts a through c below Use 0 05...

Calculus
1.2K views

Sketch the graph of 7 6 5 4 3 2 1 2 the cursor until...

Calculus
1.2K views

Find the coefficient a of the given term in the expansion of the binomial Binomial...

Algebra
1.2K views

A vegetable farmer sells three different vegetable packages The three packages are made up as...

Accounting
1.2K views

Bowman Company manufactures cooling systems. Bowman produces all the parts necessary for its...

Accounting
1.2K views

In 2018, the Westgate Construction Company entered into a contract to construct a road for...

Accounting
1.2K views

9. A company purchases 13800 shares of its own $5 par common stock on the...

Accounting
1.2K views

What is the advantage of using comparative statements for financial analysis rather than statements for...