Beginning inventory 0 Units produced 10,000 Units sold 8,000 Selling price per unit $ 75 Selling and administrative expenses: Variable per unit $ 6 Fixed (per month) $ 200,000 Manufacturing costs: Direct materials cost per unit $ 20 Direct labor cost per unit $ 8 Variable manufacturing overhead cost per unit $ 2 Fixed manufacturing overhead cost (per month) $ 100,000 Management is anxious to assess the profitability of the new camp cot during the month of May. Required:1. Assume that the company uses absorption costing.a. Determine the unit product cost.b. Prepare an income statement for May.2. Assume that the company uses variable costing.a. Determine the unit product cost.b. Prepare a contribution format income statement for May.

Beginning inventory 0 Units produced 10,000 Units sold 8,000 Selling price per unit $ 75 Selling and administrative expenses: Variable per unit $ 6 Fixed (per month) $ 200,000 Manufacturing costs:...

Beginning inventory		0
Units produced		10,000
Units sold		8,000
Selling price per unit	$	75
Selling and administrative expenses:
Variable per unit	$	6
Fixed (per month)	$	200,000
Manufacturing costs:
Direct materials cost per unit	$	20
Direct labor cost per unit	$	8
Variable manufacturing overhead cost per unit	$	2
Fixed manufacturing overhead cost (per month)	$	100,000

Management is anxious to assess the profitability of the new camp cot during the month of May.

Required:

1. Assume that the company uses absorption costing.

a. Determine the unit product cost.

b. Prepare an income statement for May.

2. Assume that the company uses variable costing.

a. Determine the unit product cost.

b. Prepare a contribution format income statement for May.

Jun 01, 2022