ACC 318, Ch 18 Axeman Company sells its razors at $3 per unit. The company...
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ACC 318, Ch 18 Axeman Company sells its razors at $3 per unit. The company uses a first-in, first-out actual costing system. A fixed manufacturing cost rate is computed at the end of each year by dividing the actual fixed manufacturing costs by the actual production units. The following data are related to its first two years of operation: Sales Production Costs: 2008 1,000 units 1,400 units 2009 1,200 units 1,000 units $ 500 Variable manufacturing Fixed manufacturing Variable operating (marketing) Fixed operating (marketing) $ 700 700 1,000 400 700 1,200 400 REQUIRED 1. Prepare income statements based on absorption (full) costing for, each of the two years. 2. Prepare income statements based on variable costing for each of the two years. 3. Prepare a numerical reconciliation and explanation of the difference between operating income for each year under absorption (full) costing and variable costing
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