Compu Services provides computerized inventory consulting. The office and computer expenses are $625,000 annually and are not assigned to specific jobs. The consulting hours available for the year total 20,000, and the average consulting hour has $30 of variable costs.

(c) If the desired profit is $60,000, what is the markup on variable costs to cover (1) unassigned costs and (2) desired profit? Round to the nearest whole percent. Markup to cover unassigned costs % Markup to cover desired profits %

Glendale Company sells its product at a unit price of $13.00. Unit manufacturing costs are direct materials, $2.50; direct labor, $3.00; and variable manufacturing overhead, $1.50. Total fixed manufacturing costs are $25,000 per year. Selling and administrative expenses are $1.00 per unit variable and $10,000 per year fixed. Though 25,000 units were produced during 2014, only 22,000 units were sold. There was no beginning inventory. (a) Prepare a functional income statement using absorption costing. (Do not use negative signs with your answers.)

Glendale Company Functional (Absorption Costing) Income Statement For the year 2014
Sales
Cost of goods sold
Gross profit
Other expenses:
Variable selling and administrative
Fixed selling and administrative
Net income

b) Prepare a contribution income statement using variable costing. (Do not use negative signs with your answers.)

Glendale Company Contribution (Variable Costing) Income Statement For the Year 2014
Sales
Variable expenses:
Cost of goods sold
Selling and administrative
Contribution margin
Fixed expenses:
Manufacturing overhead
Selling and administrative
Net income