Chapter 20 Practice Problem It's A Wonderful Life, Inc. had the below production and administrative costs for the of December.

Units Produced 65,000 Units Sold 50,000 Sales Price Per Unit 125.00$

Production Costs: Direct Materials 975,000$ Direct Labor 1,300,000$ Variable Manufacturing Costs 325,000$ Fixed Manufacturing Costs 487,500$ Total Product Costs 3,087,500$

Selling & Administrative Expenses: Variable Selling & Administrative Expenses 415,000$ Fixed Selling & Administrative Expenses 500,000$

Instructions 1) Calculate the units in ending inventory. 2) Calculate the product cost per unit for absorption costing. 3) Calculate the product cost per unit for variable costing. 4) Prepare an Absorption Costing Income Statement for the month of January. 5) Prepare a Variable Costing Income Statement for the month of January. 6) Prepare the two-step reconciliation of the two statements.