Reference no: EM13330734

Part -1:

Polk Company builds custom fishing lures for sporting goods stores. In its first year of operations, 2012, the company incurred the following costs.

Variable Cost per Unit
Direct materials $8.18
Direct labor $2.67
Variable manufacturing overhead $6.27
Variable selling and administrative expenses $4.25
Fixed Costs per Year
Fixed manufacturing overhead $257,164
Fixed selling and administrative expenses $261,709

Polk Company sells the fishing lures for $27.25. During 2012, the company sold81,100lures and produced95,600lures.

(a) Assuming the company uses variable costing, calculate Polk's manufacturing cost per unit for 2012. (Round answer to 2 decimal places, e.g.10.50.) Manufacturing cost per unit $

(b) Prepare a variable costing income statement for 2012.

POLK COMPANY

For the Year Ended December 31, 2012

Variable Costing

Administrative ExpensesContribution MarginFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet

Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses $

Administrative ExpensesContribution MarginFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet

Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses $

Administrative ExpensesContribution MarginFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet

Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses

Administrative ExpensesContribution MarginFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet

Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses

Administrative ExpensesContribution MarginFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet

Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses

Administrative ExpensesContribution MarginFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet

Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses

Administrative ExpensesContribution MarginFixed Manufacturing OverheadFixed Selling and Administrative ExpensesGross ProfitNet

Income/(Loss)SalesTotal Fixed ExpensesTotal Variable ExpensesVariable Cost of Goods SoldVariable Selling and Administrative Expenses $

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