Estimated Income Statements, using Absorption and Variable Costing Prior to the first month of operations ending October 31, Marshall Inc. estimated the following operating results: $3,600,000 Sales (40,000 x $90) Manufacturing costs (40,000 units): Direct materials Direct labor Variable factory overhead 1,440,000 480,000 240,000 120,000 75,000 Fixed factory overhead Fixed selling and administrative expenses Variable selling and administrative expenses 200,000 The company is evaluating a proposal to manufacture 50,000 units instead of 40,000 units, thus creating an ending inventory of 10,000 units. Manufacturing the additional units will not change sales, unit variable factory overhead costs, total fixed factory overhead cost, or total selling and administrative expenses. a. 2. Prepare an estimated income statement, comparing operating results if 40,000 and 50,000 units are manufactured in the variable costing format. If an amount box does not require an entry leave it blank. Marshall Inc. Variable Costing Income Statement For the Month Ending October 31 40,000 Units Manufactured 50,000 Units Manufactured Variable cost of goods sold: Variable cost of goods manufactured: $ Fixed costs: Total fixed costs Feedback