Question

The following information pertains to the first year of operation for Crystal Cold Coolers Inc.: 3,000 2,600 335 55 Number of units produced Number of units sold Unit sales price Direct materials per unit Direct labor per unit Variable manufacturing overhead per unit Fixed manufacturing overhead per unit ($240,000/3,000 units) Total variable selling expenses ($14 per unit sold) Total fixed general and administrative expenses 60 14 80 $ 36,400 $ 64,000 A tA A A A A A

Answer 1

Answer
CRYSTAL COLD COOLERS INC
Full Absorption Costing
Income Statement
Sales (2,600*$335)	$      871,000
Less: Cost of goods sold (2,600*($55+$60+$14+$80))	$      543,400
Gross Margin	$      327,600
Less: Non-manufacturing expenses
Variable selling expenses	$        36,400
Fixed general and administrative expenses	$        64,000
Net operating income	$      227,200
CRYSTAL COLD COOLERS INC
Variable Costing
Income Statement
Sales (2,600*$335)	$      871,000
Less: Variable cost of goods sold (2,600*($55+60+14))	$      335,400
Variable selling expenses	$        36,400
Contribution margin	$      499,200
Less: Fixed costs
Fixed manufacturing overhead	$      240,000
Fixed general and administrative expenses	$        64,000
Net operating income	$      195,200