Problem 5-5

The following information is available for Roger Pools, a manufacturer of above-ground swimming pool kits:

Calculate profit for both years using full costing.

Calculate profit for both years using variable costing.

Problem 5-5 The following information is available for Roger Pools, a manufacturer of above-ground swimming pool kits: Total 19,600 19,600 Units produced Units sold Selling price per unit Direct material per unit Direct labor per unit Variable manufacturing overhead per unit Fixed manufacturing overhead per year Fixed selling and administrative expense per year 2017 11,830 9,800 $4,230 $760 $1,400 $314 $2,259,530 $1,601,300 2018 7,770 9,800 $4,230 $760 $1,400 $314 $2,259,530 $1,601,300 In its first year of operation, the company produced 11,830 units but was able to sell only 9,800 units. In its second year, the company needed to get rid of excess inventory (the extra 2,030 units produced but not sold in 2017), so it cut back production to 7,770 units