Hayek Bikes prepares the income statement under variable costing for its managerial reports, and it...
90.2K
Verified Solution
Link Copied!
Question
Accounting
Hayek Bikes prepares the income statement under variable costing for its managerial reports, and it prepares the income statement under absorption costing for external reporting. For its first month of operations, 350 bikes were produced and 225 were sold; this left 125 bikes in ending inventory. The income statement information under variable costing follows.
Sales (225 $1,625)
$
365,625
Variable product cost (225 $675)
151,875
Variable selling and administrative expenses (225 $65)
14,625
Contribution margin
199,125
Fixed overhead cost
63,000
Fixed selling and administrative expense
95,000
Net income
$
41,125
1. Prepare this company's income statement for its first month of operations under absorption costing. (Round your intermediate calculations to the nearest whole dollar.)
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
