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2.The Tijama Manufacturing Company has determined the cost of manufacturing

Question : 2.The Tijama Manufacturing Company has determined the cost of manufacturing : 1416290

 

2.The Tijama Manufacturing Company has determined the cost of manufacturing a unit of product to be as follows, based on normal production of 50,000 units per year:

Direct materials$20.00

Direct labor15.00

Variable factory overhead10.00$45.00

Fixed factory overhead12.00

$57.00

 

Operating statistics for the month of August and September include:

 

AugustSeptember

Units produced4,2004,000

Units sold3,5004,200

Selling and administrative expenses$25,000$35,000

 

The selling price is $70 per unit.  There were no inventories on August 1, and there is no work in process at September 30.

 

Prepare comparative income statements for each month under the following methods:

a.Absorption costing method

b.Direct costing method

 

 

 

 

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