During the year, Summit produces 50,000 snow shovels and sells 45,000 snow shovels. Summit Manufacturing produces snow
Fantastic news! We've Found the answer you've been seeking!
Question:
Summit Manufacturing produces snow shovels. The selling price per snow shovel is $30. There is no beginning inventory.
Costs involved in production are:
Direct material ..................................................................$ 5
Direct labor ........................................................................4
Variable manufacturing overhead ..............................................3
Total variable manufacturing costs per unit ...............................$ 12
Fixed manufacturing overhead per year ..............................$180,000
In addition, the company has fixed selling and administrative costs of $160,000 per year.
Required
Calculate the difference in full costing net income and variable costing net income without preparing either income statement.
Related Book For
Cost Accounting A Managerial Emphasis
ISBN: 978-0133138443
7th Canadian Edition
Authors: Srikant M. Datar, Madhav V. Rajan, Charles T. Horngren, Louis Beaubien, Chris Graham
Posted Date: