Reference no: EM132838023

Lynch Company manufactures and sells a single product. The following costs were incurred during the company's first year of operation:

Variable costs per unit:

Manufacturing:

Direct material -------------------- ---------$ 12

Direct labor --------------------------------- $ 6

Variable manufacturing overhead -------$3

Variable selling and administrative ----------$ 3

Fixed costs per year:

Fixed manufacturing overhead ---------$ 276,000

Fixed selling and administrative ---------$186,000

During the year, the company produced 23,000 units and sold 19,000 units. the selling price of the company's product is $50 per unit.

Required:

Problem 1: Assume that the company uses variable costing - create an an income statement for the year