Question

Given the following financial data: Sales $1200K Direct Materials $500K Direct Labor $250K Variable Factory Overhead Fixed Factory Overhead Variable Selling and Admin Costs $50K $75K $25K Fixed Selling and Admin Costs $60K 1. (2 pts) Write an Absorption Financial Statement using the above data. Include Gross Margin and Operating Income in the statement. 12 04 k Absafption 45 O 2. (2 pts) Using the same basic data in the table above, write a Contribution Financial Statement. Include Contribution Margin and Operating Income. 75 475 k 250+500 + 25 25 K F SAC: 25 k 0ED
this is a management systems control subject

Answer 1

1]	ABSORPTION FINANCIAL STATEMENT
	Sales		$   12,00,000
	Less: Cost of goods sold:
	Direct materials	$   5,00,000
	Direct labor	$   2,50,000
	Variable factory overhead	$      50,000
	Fixed factory overhead	$      75,000
	Cost of goods sold		$     8,75,000
	Gross margin		$     3,25,000
	Less: Operating expenses:
	Variable selling and admin costs	$       25,000
	Fixed selling and admn costs	$       60,000
	Operating expenses		$        85,000
	Operating income		$     2,40,000
2]	CONTRIBUTION FINANCIAL STATEMENT
	Sales		$   12,00,000
	Less: Variable expense:
	Direct materials	$   5,00,000
	Direct labor	$   2,50,000
	Variable factory overhead	$      50,000
	Variable selling and admin costs	$      25,000
	Total variable expenses		$     8,25,000
	Contribution margin		$     3,75,000
	Less: Fixed expenses:
	Factory overhead	$       75,000
	Selling and admn costs	$       60,000
	Operating expenses		$     1,35,000
	Operating income		$     2,40,000