Reference no: EM13679887

Problem 2:

The following is the current variable costing income statement for Dolly Corporation.

Sales (5,000 units) $100,000
Variable expenses Cost of goods sold $35,000
Selling (10% of sales) $10,000 $45,000
Contribution margin $55,000
Fixed expenses
Manufacturing overhead $24,000
Administrative $12,500 $36,500
Operating income $18,500

Below is the following information on operations for Dolly Corporation.

Beginning inventory (units) 0
Units produced (units) 6,000
Manufacturing costs
Direct labor (per unit) $5.00
Direct materials (per unit) $2.30
Variable overhead (per unit) $2.40

Required:
Prepare an absorption costing income statement.

Problem 3:

. The following information was compiled for two models of cell phones.



3G model

4G model

Average


Budgeted Contribution Margin

$80.00

$120.00

$95.25


Budgeted

Sales in Units

28,000

18,000


Actual

Sales in Units

28,600

16,500

Calculate the sales mix variance. (Show your calculations.)