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Question - Dion Company reports the absorption costing income statement below for May. The company began the month with no finished goods inventory. Dion produced 21,600 units, and 2,800 units remain in ending finished goods inventory for May. Fixed overhead was $54,000. Variable selling and administration expenses were $38,000 and fixed selling and administrative expenses were $18,000.
Sales (18,800 units) $470,000
Cost of goods sold 388,000
Gross profit 82,000
Selling and administrative expenses 56,000
Income $26,000
Required - Prepare an income statement using variable costing.
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