Gallatin County Motors Inc. assembles and sells snowmobile engines. The company began operations on July 1 and operated at 100% of capacity during the first month. The following data summarize the results for July:

Sales (9,000 units)                                                $1,350,000

Production costs (12,000 units):  

Direct materials                                                      $666,000

 Direct labor                                                              319,200  

Variable factory overhead                                       159,600

 Fixed factory overhead                                           106,800        1,251,600 

Selling and administrative expenses:  

Variable selling and administrative expenses     $194,000  

Fixed selling and administrative expenses          75,100                        269,100 

If required, round interim per-unit calculations to the nearest cent.

a. Create an income statement according to the absorption costing concept.

Sales : 1,350,000

Cost of goods sold: ? 

Gross Profit: ? 

Selling and administrative expenses: ? 

Operating Income: ? 

B. income statement according to the variable costing concept: 

Sales:  1,350,000

Variable cost of goods sold: ?

Manufacturing margin: ?

Variable selling and administrative expenses: ? 

Contribution margin: ?

Fixed Costs 

Fixed factory overhead costs:  ?

Fixed selling and administrative expenses: ?

Total fixed costs: ? 

operating income: ? 

Answer rating: 100% (QA)

a Income statement according to the absorption costing concept Calculation of the cost of goods sold ... View the full answer