Hasselback, Inc., produced 175,000 units and prepared the following income report using absorption costing:

Required:
A. Determine Hasselback€™s profit using unit- variable costing.
B. Determine Hasselback€™s profit using throughput costing.
C. Which method do you think presents the most realistic picture of current earnings? Why?

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Sales (100,000 units Less cost of goods sold: $15,000,000 Direct materials Direct labor Unit-related overhead Other overhead $1,200,000 300,000 900,000 4,000,000 6,400,000 $8,600,000 Gross margin Less other operating costs: Variable selling and administrative costs Fixed selling and administrative costs 600,000 2,000,000 $6,000,000 Profit