Holden Corp has the following income statement under standard absorption
Holden Corp. has the following income statement under standard absorption costing:
Sales .............. $1,000,000
Cost of goods sold:
Beginning inventory ......... $ 0
Production ........... $ 975,000
Ending inventory ..........$ 225,000
Cost of goods sold: ........ $ 750,000
Less adjustment for variances .... $ 95,000
Adjusted cost of goods sold ..... $ 655,000
Gross profit ........... $ 345,000
Selling and administrative expenses
Variable selling and administrative ... $ 30,000
Fixed selling and administrative ... $ 170,000
Net income ........... $ 145,000
During the period Holden produced 130,000 units and sold 100,000 units. There was no beginning or ending WIP inventory. Budgeted fixed factory overhead was $150,000, actual fixed factory overhead was $90,000, and denominator level was 100,000 units. Holden does not prorate variances.
Present a variable costing income statement. Be sure to list the amount of any variance in an adjustment for variances.

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