Reference no: EM132549464

Kylie Company has beginning inventory of 0 units. In 2019 Kylie Company planned to produce 21,000 units and produced 21,000 units. Unit selling price was $900. Variable manufacturing overhead was $25 per unit. Fixed manufacturing costs were $100,000 and fixed marketing costs were $618,000. Variable marketing costs of $300 per unit sold. Kylie had 0 units left in ending inventory. Direct material and direct labor costs were $300 and $200 per unit, respectively. Kylie Company has a tax rate of 40%. All variances are written off to COGS (cost of good sold), the allocation base for fixed costs is planned units of production, and current year's budgeted per unit production cost is the same as prior year's per unit production cost.

Requirements:

(Put your answers below. No steps are required)

For each of the following questions (A to E), choose the best answer from the Choices of Answer for Kylie Company.

Question A. What is the difference in net income between variable and absorption costing?

Question B. What is the difference in revenue between variable and absorption costing?

Question C. What is Income Tax Expense under Variable Costing?

Question D. What is Variance Adjustment under Absorption Costing?

Question E. What is Net Income under Absorption Costing?