Reference no: EM133006154

Problem - Company manufactures only one product. It has provided the following data concerning its most recent month of operations: Selling price $ 148 Units in beginning inventory 500 Units produced 4,100 Units sold 4,400 Units in ending inventory 200 Variable costs per unit: Direct materials $31 Direct labor $59 Variable manufacturing overhead $4 Variable selling and administrative expense $9 Fixed costs: Fixed manufacturing overhead $94,300 Fixed selling and administrative expense $47,300 Company produces the same number of units every month, although the sales in units vary from month to month. Company's variable costs per unit and total fixed costs have been constant from month to month.

Required -

Part A: Using the contribution approach, how much is net income? Insert answer here: Contribution income.

Part B: Using the traditional approach, how much is net income? Insert answer here: Traditional income.

Part C: How much is the difference between the reported ending inventory using the traditional approach and the ending inventory using the contribution approach?