Reference no: EM13845266

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 $255,819

Fixed selling and administrative expenses $261.709

Polk Company sells the fishing lures for $27.25. During 2012, the company sold 80,200 lures and produced 95,100 lures.

(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.)

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

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

(d) Prepare an absorption costing income statement for 2012.