Accounting

20-1B

During the first month of operations ended September 30, 2012, Sungsam Inc. manufactured 3,200 flat panel televisions, of which 3,000 were sold. Operating data for the month are summarized as follows.

 

Sales………………………………………………………………………………………………..$4,275,000

Manufacturing costs:

Direct Materials…………………………………………$1,680,000

Direct Labor………………………………………………….720,000

Variable manufacturing cost……………………… 272,000

Fixed manufacturing cost………………………………. 505,600 $3,177,600

Selling and admin. expenses:

Variable……………………………………………………..$ 408,000

Fixed…………………………………………………………… 195,000 603,000

 

Instructions

1)Prepare an income statement based on absorption costing concept

2)Prepare an income statement based on variable costing concept

3) Explain the reason for the difference in the amount of income from operations reported in (1) and (2)

20-3B

21-3B