Solution-Present a contribution format income statement

Present a contribution format income statement

Reference no: EM131779221

Basketball Products has the following cost information available for 2013:

Direct materials	$5.00 per unit
Direct labor	$4.00 per unit
Variable manufacturing overhead	$3.00 per unit
Variable selling and administrative costs	$2.00 per unit
Fixed manufacturing overhead	$21,000
Fixed selling and administrative costs	$5,000

During 2013, Basketball produced 2,000 units out of which 1,500 units were sold for $50 each.

Required:

A. Present a contribution format income statement using variable costing.

B. Present a multi-step income statement assuming the company uses absorption costing.

C. Why is net income under these methods different?

Reference no: EM131779221

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Present a contribution format income statement

Reference no: EM131779221

Reference no: EM131779221

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