Prepare a contribution format income statement for packer

Assignment Help Accounting Basics

Reference no: EM131955942

Problem

Packer Company, which has only one product, has provided the following data concerning its most recent month of operations:

Selling price	91
Units in beginning inventory	490
Units produced	2,520
Units sold	2,700
Units in ending inventory	310
Variable costs per unit:
Direct materials	20
Direct labor	21
Variable manufacturing overhead	2
Variable selling and administrative	12
Fixed costs:
Fixed manufacturing overhead	52,920
Fixed selling and administrative	8,100

The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. (Hint: Use the reconciliation method.)

Required:

a. What is the unit product cost for the month under variable costing?

b. Prepare a contribution format income statement for the month using variable costing.

Reference no: EM131955942

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