Question

Carpet Clean manufactures a chemical carpet cleaner. The company was formed during the current year. As a result, there was no beginning inventory. Management is evaluating performance and inventory management issues, and desires to know both net income and ending inventory under generally accepted accounting principles (absorption costing) as well as variable costing methods. Relevant facts are as follows:

Selling price per gallon	$ 13.00
Variable manufacturing cost per gallon	2.50
Variable SG&A costs per gallon	2.37
Fixed manufacturing costs	$ 3,125,000
Fixed SG&A	493,000
Total gallons produced	1,633,000
Total gallons sold	1,493,511

Worksheet 1

Absorption Costing
Variable manufacturing costs			$ -
Fixed manufacturing costs			-
Cost of goods manufactured			$ -
Cost of goods sold			-
Ending inventory			$ -
Sales			$ -
Cost of goods sold			-
Gross profit			$ -
Selling, general, & administrative costs
Variable	$ -
Fixed	-		-
Net income			$ -
Variable Costing
Ending inventory			$ -
Sales			$ -
Variable manufacturing costs			-
Variable manufacturing margin			$ -
Variable SG&A			-
Contribution margin			$ -
Fixed expenses
Manufacturing	$ -
SG&A	-		-
Net income			$ -

Answer 1

Absorption Costing
Variable manufacturing costs	4,082,500.00
Fixed manufacturing costs	3,125,000.00
Cost of goods manufactured	7,207,500.00
Cost of goods sold	6,591,843.56
Ending inventory	615,656.44
Sales	19,415,643.00
Cost of goods sold	6,591,843.56
Gross profit	12,823,799.44
Selling, general, & administrative costs
Variable	3,539,621.07
Fixed	493,000.00
Net income	8,791,178.37
Variable Costing
Ending inventory	348,722.50
Sales	19,415,643.00
Variable manufacturing costs	3,733,777.50
Variable manufacturing margin	15,681,865.50
Variable SG&A	3,539,621.07
Contribution margin	12,142,244.43
Fixed expenses
Manufacturing	3,125,000.00
SG&A	493,000.00
Net income	8,524,244.43

please rate.