Summarized data for 2016 (the first year of operations) lir Gorman Products, Inc., are as follows:...

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Summarized data for 2016 (the first year of operations) lir Gorman Products, Inc., are as follows: Sales (75,000 units). Production costs (80,000 units): Direct material. .. $3,000,000 880,000 720,000 Direct labor. Manufacturing overhead: Variable. 544,000 320,000 Fixed.. Operating expenses: Variabie.. 168,000 240,000 60,000 18,000 28,800 30,000 Fixed.. Depreciation on equipment. Real estate taxes Personal property taxes (on inventory and equipment) Personnel department expenses.. Required a. Prepare an income statement based on full absorption costing. b. Prepare an income statement based on variable costing. Assume that you must decide quickly whether to accept a special one-time order for 10 for $30 per unit. Which income statement presents the most relevant data? Determine the ent profit or loss on the special order based solely on these data. d. If the ending inventory is destroyed by fire, which costing approach would you use as a bu filing an insurance claim for the fire loss? Why? C. Summarized data for 2016 (the first year of operations) lir Gorman Products, Inc., are as follows: Sales (75,000 units). Production costs (80,000 units): Direct material. .. $3,000,000 880,000 720,000 Direct labor. Manufacturing overhead: Variable. 544,000 320,000 Fixed.. Operating expenses: Variabie.. 168,000 240,000 60,000 18,000 28,800 30,000 Fixed.. Depreciation on equipment. Real estate taxes Personal property taxes (on inventory and equipment) Personnel department expenses.. Required a. Prepare an income statement based on full absorption costing. b. Prepare an income statement based on variable costing. Assume that you must decide quickly whether to accept a special one-time order for 10 for $30 per unit. Which income statement presents the most relevant data? Determine the ent profit or loss on the special order based solely on these data. d. If the ending inventory is destroyed by fire, which costing approach would you use as a bu filing an insurance claim for the fire loss? Why? C.

Answer rating: 100% (QA)

a Absorption Costing Income Statement Sales 300000 Cost of Goods Sold Beginning Inventory Direct mat... View the full answer