During 2013, Life works Inc. Had $200,000 in sales commission, $120,000 in administrative costs of which $ 20,000 fixed. Their selling price per unit was $40. direct materials was $4. direct labor $8. and variable overhead was $3. fixed overhead amounted to $600,000.

Prepare an income statement under absorption and variable costing. if :

1. Sold unit 60,000 and produced unit 60,000

2. Sold unit 40,000 and produced unit 60,000

3. Sold unit 80,000 and produced unit 60,000

Detailed the income statement.

Answer rating: 100% (QA)

Under absorption costing the income statement would be as follows Sold unit 60000 and produced unit 60000 Sales 40 per unit 60000 units 2400000 Cost o... View the full answer