Reference no: EM13546560
1)Assume a company sells a given product for 85 per unit how many units must be sold to break even if the variable selling cost are 27 per unit. variable production cost are 23 per unit, and total fixed costs are 700,000.
2)Aivars company reports the following variable cost income statement for its single product this company sales totaled 50,000 units but its productin was 80,00 units it had no begining finished goods inventoey for that period.
sales(50,000 units x60 per unit)3000000
variable expenses
variable manufacturing expense (50,000 units x28 per unit)1400000
varible selling and admin expenses(50,000 units x5 per unit)250,000
total variable expenses 1650000
contribution margin1,350000
fixed expenses
fixed over head 320000
fixed selling and admin expenses 160,000
total fixed expenses 480,000
net income 870,000
Convert this companys variable costing income statement to an absorption costing income statement.
Explain the difference in income between the variable costing and absorption costing statement