Required A

Required C

Problem 9-53 (Static) Comparative Income Statements and Management Analysis ( LO 91,5,6) Normandy Office Products (NOP) makes two types of office desks, Manager and Executive. The Executive model is adjustable using electric motors and is made with upgraded materials. The manufacturing process for the Executive model is more complex than that for the Manager model, requiring more frequent inspections and shorter production runs. The Manager model is a basic desk, using good, but easy to work with, materials, and is simpler to manufacture. NOP's results for the last fiscal year are shown in the following statement. NOP currently uses labor costs to allocate all overhead, but management is considering implementing an activity-based costing system. After interviewing the sales and production staff, management decides to allocate administrative costs on the basis of direct labor costs but to use the following bases to allocate the remaining costs: NOP currently uses labor costs to allocate all overhead, but management is considering implementing an activity-based costing system. After interviewing the sales and production staff, management decides to allocate administrative costs on the basis of direct labor costs but to use the following bases to allocate the remaining costs: Prepare are product line income statement using the proposed activity bases. Note: Do not round intermediate calculations. Input all amounts as positive values. Restate the product line income statement for Normandy Office Products using direct labor costs as the only overhead allocation base. Note: Do not round intermediate calculations. Input all amounts as positive values