Question

th6 Homework Help Save & Exit Submit Check my work Ida Sidha Karya Company is a family-owned company located on the island of Bali in Indonesia. The company produces a handcrafted Balinese musical instrument called a gamelan that is similar to a xylophone. The gamelans are sold for $900. Selected data for the company's operations last year follow. points 300 Units in beginning inventory Units produced Units sold Units in ending inventory Variable costs per unit. Direct materials 125 Variable manefacturing overhead Variable selling and administrative Fixed costs Fixed manufacturing overhead Fixed selling and administrative $ 63,000 $ 25.000 The absorption costing income statement prepared by the company's accountant for last year appears below. Sales Cost of goods sold Gross margin Selling and administrative expense Net operating income $ 247.500 199375 40.125 34.625 $ 13,500 Required: 1 Under absorption costing, how much foxed manufacturing overhead cost is included in the company's inventory at the end of last year? 2. Prepare an income statement for last year using variable costing Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare an income statement for last year using variable costing. Ida Sidha Karya Company Variable Costing Income Statement les Variable expenses Variable cost of goods sold $ 1993 Variable selling and administrative expense Contribution margin fixed manufacturing overhead Fixed selling and administrative expense Net operating income

Answer 1

Req. 1	Under abasorption costing following amount of fixed manufacturing overhead is included in ending inventory
	Total Fixed manf. Cost	63000
	No, of Units manufact.	300
	Cost Per unit	210
	No. if units not sold(ending inventory)	25	(300-275)
	fixed manufacturing overhead is included in ending inventory	5250	(210*25)
Req. 2	Ida Sidha Kanya Company
	Variable Costing Income Statement
	Particulars		Amount
	Sales		247500
	Variable Expenses		-141625
	Direct Material	34375
	Direct LABOUR	94875
	Manufacturing Overhead	12375
	Less: Variable Selling and Administrative exp.	-9625
	Contribution Margin		96250
	Fixed Expenses:
	Manufacturing Overhaed		-63000
	Selleing and Adminstrative Expense		-25000
	Net Operating Income		8250