B 6-1 Prol X Cengag X Cengag X learn.sr x B 6-2 Blog X 5 MKT 31 X Course X Certifie X Bookm: X + X -> C A v2.cengagenow.com/ilrn/takeAssignment/takeAssignmentMain.do?invoker=&takeAssignmentSessionLocator=&inprogress=false Q u . .. Problem Set: Module 6 eBook Show Me How 1. EX.07.02.ALGO Income Statements under Absorption Costing and Variable Costing 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 2. TMM.07.05 for July: 3. EX.07.05.ALGO Sales (9,000 units) $1,350,000 Production costs (12,000 units): 4. TMM.07.01 Direct materials $666,000 5. EX.07.12.ALGO 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. hulu a. Prepare an income statement according to the absorption costing concept. Gallatin County Motors Inc. Absorption Costing Income Statement For the Month Ended July 31 Sales Cost of goods sold Gross profit Selling and administrative expenses Operating income Feedback Check My Work Progress: 1/5 items Check My Work Next 3 55 Assignment Score: 68.32% Email Instructor Save and Exit Submit Assignment for GradingB 6-1 Prol X Cengag X Cengag X learn.sr x B 6-2 Blog X 5 MKT 31 X Course X Certifie X Bookm: X + X -> C v2.cengagenow.com/ilrn/takeAssignment/takeAssignmentMain.do?invoker=&takeAssignmentSessionLocator=&inprogress=false ... Problem Set: Module 6 7 eBook Show Me How 1. EX.07.02.ALGO b. Prepare an income statement according to the variable costing concept. 2. TMM.07.05 Gallatin County Motors Inc. Variable Costing Income Statement 3. EX.07.05.ALGO For the Month Ended July 31 Sales 4. TMM.07.01 Variable cost of goods sold V 5. EX.07.12.ALGO Variable selling and administrative expenses X Variable selling and administrative expenses Contribution margin Fixed costs: Fixed factory overhead costs Fixed selling and administrative expenses Total fixed costs Operating income hulu Feedback Check My Work b. Under variable costing, the cost of goods manufactured includes only variable manufacturing costs. c. What is the reason for the difference in the amount of operating income reported in (a) and (b)? Under the absorption costing V method, the fixed manufacturing cost included in the cost of goods sold is matched with the revenues. Under variable costing V , all of the fixed manufacturing cost is deducted in the period in which it is incurred, regardless of the amount of inventory change. Thus, when inventory increases, the absorption costing _ v income statement will have a higher operating income. Feedback Check My Work Progress: 1/5 items Check My Work Next 3 55 Assignment Score: 68.32% Email Instructor Save and Exit Submit Assignment for Grading