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217 kissimmee paint co reported the following data for the month of july there were 4295051

 

217. Kissimmee Paint Co. reported the following data for the month of July. There were no beginning inventories and all units were completed (no work in process).
 

 

Total Cost

Number of Units

Unit Cost

Manufacturing costs:

 

 

 

  Variable

$465,000

30,000

$15.50

  Fixed

  210,000

30,000

    7.00

    Total

$675,000

 

$22.50

 

 

 

 

 

Selling and administrative expenses:

 

  Variable

$2 per unit sold

  Fixed

$39,000

 

 

In the month of July, 28,000 of the 30,000 units manufactured were sold at a price of $80 per unit.
 

(a)

Prepare a variable costing income statement.

(b)

Prepare an absorption costing income statement.

(c)

Briefly explain why there is a difference in income from operations between the two methods.

 

 

 

 

 

 

 

 

 

 

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