Sharon Lee, CEO of Carla Vista Industries, is concerned about the recent volatility in the company's...

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Sharon Lee, CEO of Carla Vista Industries, is concerned about the recent volatility in the company's operating income. She believes that since the number of units sold has been fairly stable over the past three years that operating income also should have been stable. Sharon asked Brian Walker, Carla Vista's inventory manager, to help her understand the issue. Brian reviewed the company's records and compiled the following changes to Finished Goods Inventory (in units) for the years 2019, 2020, and 2021. Year 2019 2020 2021 Beginning inventory 1,000 2,000 500 Production 40,000 38,000 40,000 Sales (39,000) (39,500) (39,500) Ending inventory 2,000 500 1,000 Brian also gathered the 2019 income statements prepared using absorption costing and variable costing, which follow. Income Statement-Absorption Costing Sales $ 4,875,000 Cost of goods sold Units in beginning inventory (92,000) Units sold from current year production (3,496,000) Total cost of goods sold (3,588,000) Gross margin 1,287,000 Selling expense (610,000) Operating Income 677,000 Income Statement-Variable Costing Sales $ 4,875,000 Variable production expenses (2,106,000) Variable selling expenses (156,000) Contribution margin 2,613,000 Fixed manufacturing expenses (1,520,000) Fixed selling expenses (454,000) Operating income $ 639,000 (a) Compute the unit product cost for 2019, 2020, and 2021 for variable and absorption costing. Assume that variable costs per unit and total fixed costs do not change from one year to the next. (Round answers to 2 decimal places, e.g. 15.25.) 2019 2020 2021 Unit product cost using variable costing Unit product cost using absorption costing $ $ eTextbook and Media Save for Later Attempts: 0 of 5 used Submit Answer %24 %24 %24 %24 %24 Sharon Lee, CEO of Carla Vista Industries, is concerned about the recent volatility in the company's operating income. She believes that since the number of units sold has been fairly stable over the past three years that operating income also should have been stable. Sharon asked Brian Walker, Carla Vista's inventory manager, to help her understand the issue. Brian reviewed the company's records and compiled the following changes to Finished Goods Inventory (in units) for the years 2019, 2020, and 2021. Year 2019 2020 2021 Beginning inventory 1,000 2,000 500 Production 40,000 38,000 40,000 Sales (39,000) (39,500) (39,500) Ending inventory 2,000 500 1,000 Brian also gathered the 2019 income statements prepared using absorption costing and variable costing, which follow. Income Statement-Absorption Costing Sales $ 4,875,000 Cost of goods sold Units in beginning inventory (92,000) Units sold from current year production (3,496,000) Total cost of goods sold (3,588,000) Gross margin 1,287,000 Selling expense (610,000) Operating Income 677,000 Income Statement-Variable Costing Sales $ 4,875,000 Variable production expenses (2,106,000) Variable selling expenses (156,000) Contribution margin 2,613,000 Fixed manufacturing expenses (1,520,000) Fixed selling expenses (454,000) Operating income $ 639,000 (a) Compute the unit product cost for 2019, 2020, and 2021 for variable and absorption costing. Assume that variable costs per unit and total fixed costs do not change from one year to the next. (Round answers to 2 decimal places, e.g. 15.25.) 2019 2020 2021 Unit product cost using variable costing Unit product cost using absorption costing $ $ eTextbook and Media Save for Later Attempts: 0 of 5 used Submit Answer %24 %24 %24 %24 %24

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a 2019 2020 2021 Unit product cost using variable costing 210600039000 54 54 ... View the full answer