Prepare a segmented income statement for knitline

Reference no: EM131975260

Problem

Segmented Income Statement

Knitline Inc. produces high-end sweaters and jackets in a single factory. The following information was provided for the coming year.

Sweaters Jackets

	Sweaters	Jackets
Sales	$294,000	$630,000
Variable cost of goods sold	145,000	196,000
Direct fixed overhead	25,000	47,000

A sales commission of 5% of sales is paid for each of the two product lines. Direct fixed selling and administrative expense was estimated to be $28,000 for the sweater line and $70,000 for the jacket line.

Common fixed overhead for the factory was estimated to be $45,000. Common selling and administrative expense was estimated to be $15,000.

Required:

Prepare a segmented income statement for Knitline for the coming year, using variable costing.

Reference no: EM131975260

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