Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. the following data are from the accounting records

The following data are from the accounting records of Niles Castings for year 2. Units produced and...

Free

70.2K

Verified Solution

Question

Accounting

The following data are from the accounting records of NilesCastings for year 2.

Units produced and sold88,000
Total revenues and costs
Sales revenue$340,000
Direct materials costs70,000
Direct labor costs36,000
Variable manufacturing overhead17,000
Fixed manufacturing overhead43,000
Variable marketing and administrative costs16,500
Fixed marketing and administrative costs37,000

a. Prepare a gross margin income statement.

b. Prepare a contribution margin incomestatement.

Answer & Explanation Solved by verified expert
4.2 Ratings (677 Votes)

a)

NILES CASTINGS

ABSORPTION COSTING INCOME STATEMENT

FOR THE YEAR ENDED DECEMBER 31 ,YEAR 2
Sales revenue 340000
less:Cost of goods sold
Direct material 70000
Direct labor 36000
variable manufacturing overhead 17000
Fixed manufacturing overhead 43000
Total cost of goods sold (166000)
Gross margin 174000
less:Selling and administrative expense
Variable 16500
Fixed 37000
Total Selling and administrative expense (53500)
Net operating income 120500

b)

NILES CASTINGS

CONTRIBUTION MARGIN INCOME STATEMENT

FOR THE YEAR ENDED DECEMBER 31 ,YEAR 2
Sales revenue 340000
less:Variable expenses
Direct material 70000
Direct labor 36000
variable manufacturing overhead 17000
Variable marketing and administrative costs 16500
Total variable expenses (139500)
contribution margin 200500
less:Fixed cost
Fixed manufacturing overhead 43000
Fixed Fixed marketing and administrative costs 37000
Total fixed expense (80000)
Net operating income 120500

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!
Become a Member

Other questions asked by students

Q

Determine the following quantities for a car driving on a level surface with a coefficient of...

Physics
Q

To better understand the polarization consider two components of the electric field: Ex(t) = 3 Cos (w...

Physics
Q

Explain groupthink theory and how it relates to workplace and what are it advantages at workplace...

Psychology
Q

A top-loading washing machine has a cylindrical tub that rotates about a vertical axis. The tub...

Physics
Q

Scenario 1: Contracts Find a contract, such as one you have signed, obtained from a business or...

Operations Management
Q

The two slits at a distance of 1 mm are illuminated by the light of...

Physics
Q

Simplify 6 Do not use a calculator Write the exact simplified fo

Algebra
Q

Assume a companys sales budget for April and May is 31,000 units and 33,000 units,...

Accounting
Q

Requirements: 1. Prepare a schedule of cash receipts for...

Accounting
Q

Walman Corp. manufactures products X, Y, and Z from a joint production process. Joint costs...

Accounting
Q

please Select better or worse for each one. Thank you please...

Accounting
Q

What is a job order costing system? What are some common examples of job order...

Accounting