Question

The EG Company produces andsells single product. The following data refer to the year justcompleted:

Beginninginventory		0
Units produced		34,500
Units sold		26,800
Selling price perunit	$	490
Selling andadministrative expenses:
Variable perunit	$	16
Fixed (total)	$	616,400
Manufacturingcosts:
Direct materialscost per unit	$	254
Direct labor costper unit	$	55
Variablemanufacturing overhead cost per unit	$	33
Fixed manufacturingoverhead (total)	$	552,000

Assume that direct labor is a variable cost.

Required:

a.	Compute the cost of a single unit of product under both theabsorption costing and variable costing approaches. (Omitthe "$" sign in your response.)

	Cost perunit
Absorptioncosting	$
Variablecosting	$

b.	Prepare an income statement for the year using absorptioncosting. (Input all amounts as positive values exceptlosses which should be indicated by a minus sign. Omit the "$" signin your response.)

Absorption Costing Income Statement
(Click toselect)Gross marginNet operating income (loss)Selling andadministrative expensesSalesCost of goods sold	$
(Click toselect)Selling and administrative expensesNet operating income(loss)Gross marginSalesCost of goods sold
(Click toselect)Gross marginSelling and administrative expensesCost of goodssoldSalesNet operating income (loss)
(Click to select)Netoperating income (loss)SalesSelling and administrativeexpensesGross marginCost of goods sold
(Click toselect)Selling and administrative expensesNet operating income(loss)SalesCost of goods soldGross margin	$

c.	Prepare a contribution format income statement for the yearusing variable costing. (Input all amounts as positivevalues except losses which should be indicated by a minus sign.Omit the "$" sign in your response.)

Variable Costing Income Statement
(Click to select)Netoperating income (loss)Variable selling and administrativeexpensesVariable cost of goods soldManufacturingoverheadContribution marginSalesSelling and administrativeexpenses		$
Variableexpenses:
(Click toselect)Contribution marginSalesFixed manufacturing overheadVariablecost of goods soldNet operating incomeVariable selling andadministrative expensesFixed selling and administrativeexpenses	$
(Click to select)Fixedselling and administrative expensesContribution marginVariableselling and administrative expensesSalesNet operating incomeFixedmanufacturing overheadVariable cost of goods sold
(Click toselect)Variable cost of goods soldManufacturingoverheadContribution marginSelling and administrative expensesNetoperating income (loss)Variable selling and administrativeexpensesSales
Fixed expenses:
(Click to select)Fixedselling and administrative expensesVariable cost of goodssoldSalesNet operating incomeContribution marginFixed manufacturingoverheadVariable selling and administrative expenses
(Click to select)Variablecost of goods soldContribution marginFixed manufacturingoverheadVariable selling and administrative expensesSalesNetoperating incomeFixed selling and administrative expenses
(Click toselect)Variable selling and administrative expensesSelling andadministrative expensesManufacturing overheadContributionmarginVariable cost of goods soldSalesNet operating income(loss)		$

d.	Reconcile the absorption costing and variable costing netoperating income figures in (b) and (c) above. (Omit the"$" sign in your response.)

Reconciliation of Variable Costing and Absorption Costing NetOperating Incomes
Net operating incomeunder variable costing	$
(Click toselect)DeductAdd: (Click to select)Fixed manufacturing overheadcosts released from inventory under absorption costingFixedmanufacturing overhead costs deferred in inventory under absorptioncosting
Net operating incomeunder absorption costing	$