Variable and Absorption Costing
Chandler Company sells its product for $ per unit. Variable manufacturing costs per unit are $ and fixed manufacturing costs at the normal operating level of units are $ Variable selling expenses are $ per unit sold. Fixed administrative expenses total $ Chandler had no beginning inventory for the year. During the year, the company produced units and sold Would net income for Chandler Company be higher if calculated using variable costing or using absorption costing?
Calculate reported income using each method.
Do not use negative signs with any answers.
Absorption Costing Income Statement
Sales Answer
Cost of Goods Sold:
Beginning Inventory Answer
Variable Costs Answer
Fixed Costs Answer
Less: Ending Inventory Answer
Cost of Goods Sold Answer
Answer
Gross profit
Answer
Answer
Selling expense
Answer
Administrative expense Answer
Net Income Answer
Variable Costing Income Statement
Sales Answer
Cost of Goods Sold:
Beginning Inventory Answer
Variable Costs Answer
Answer
Answer
Variable cost of goods sold Answer
Answer
Answer
Answer
Answer
Fixed costs:
Answer
Answer
Administrative Expense Answer
Total Fixed Cost Answer
Net Income Answer
