Reference no: EM133085249

Question - Pina, Inc. is a company that manufactures and sells a single product. Unit sales for each of the four quarters of 2020 are projected as follows.

Quarter Units

First 68,800

Second 129,000

Third 473,000

Fourth 103,200

Annual total 774,000

Pina incurs variable manufacturing costs of $0.40 per unit and variable nonmanufacturing costs of $0.40 per unit. Pina will incur fixed manufacturing costs of $619,200 and fixed nonmanufacturing costs of $928,800. Pina will sell its product for $4 per unit.

Determine the amount of net income Pina will report in each of the four quarters of 2020, assuming actual sales are as projected and employing the integral approach to interim financial reporting. (Ignore income taxes.) Repeat the analysis under the discrete approach.

Compute Pina's profit margin on sales for each of the four quarters of 2020 under both the integral and discrete approaches.