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BC is a division of California controls Corporation. The division manufactures and sells a pump that is used in a wide variety of applications. The division manager is considering producing either 30,000 or 60,000 units this period. Other information is presented in the schedule below

Division Information
Beginning inventory 0
Expected sales in units 30,000
Selling price per unit $27
Variable manufacturing cost per unit $10
Variable selling and administrative cost per unit $6
Total fixed manufacturing overhead costs $300,000
Fixed manufacturing overhead costs per unit
Based on 30,000 units ($300,000 / 30,000) $10
Based on 60,000 units ($300,000 / 60,000) $5
Manufacturing cost per unit
Based on 30,000 units ($10 variable + $10 fixed) $20
Based on 60,000 units ($10 variable + $5 fixed) $15
Fixed selling and administrative expenses $13,000

A. prepare an absorption costing income statement for 30,000 units produced and 30,000 units sold.

B. Prepare a variable costing income statement for 30,000 units produced and 30,000 units sold.

C. Prepare an absorption costing income statement for 60,000 units produced and 30,000 units sold.

D. Prepare a variable costing income statement for 60,000 units produced and 30,000 units sold.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9984717

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