Perez Glass Company makes stained glass lamps. Each lamp that it sells for $
per lamp requires $ of direct materials and $ of direct labor. Fixed overhead
costs are expected to be $ per year. Perez Glass expects to sell lamps
during the coming year. Selling and administrative expenses were zero.
Required:
a Prepare income statements using absorption costing, assuming that Perez Glass
makes and lamps during the year.
b Prepare income statements using variable costing, assuming that Perez Glass
makes and lamps during the year.
