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In: Accounting

Wilson Corporation produces a single product. Data concerning the company’s operations last year appears below: Units...

  1. Wilson Corporation produces a single product. Data concerning the company’s operations last year appears below:

Units in beginning inventory…………………………………………….………            0

Units produced…………….……………………………………………..………   10,000

Units sold…………………………………………………………………………    9,180

Selling price per unit……………………………………………………….……         $75.00

                                                               

       Variable costs per unit:

Direct materials………………………………………………………      $22.75

Direct labor…………………………………………………………..         $8.15

Variable manufacturing overhead…………… ………………………        $5.83

Variable selling and administrative……………...……………………        $5.50

                Fixed costs in total:

                                    Fixed manufacturing overhead……………………………………   $202,400

                                    Fixed selling and administrative………………...…………………   $70,500

   Required:

  1. Compute the unit product cost under absorption costing. (2 points)

Absorption UNIT product cost = _______________

  1. Compute the unit product cost under variable costing. (2 points)

Variable UNIT product cost = _________________

  1. Prepare a traditional format income statement for the year using absorption costing. (4 points)

  1. Prepare a contribution margin income statement for the year using variable costing. (4 points)
  1. Reconcile the difference between the net income you computed under the two methods. (1 point)

Solutions

Expert Solution

ekkarill92 answered 2 years ago
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