Problem
Siren Company builds custom fishing lures for sporting goods stores. In its first year of operations, 2017, the company incurred the following costs.
Variable Costs per Unit
Direct materials $7.88
Direct labor $3.62
Variable manufacturing overhead $6.09
Variable selling and administrative expenses $4.10
Fixed Costs per Year
Fixed manufacturing overhead $244,590
Fixed selling and administrative expenses $220,605
Siren Company sells the fishing lures for $26.25. During 2017, the company sold 81,000 lures and produced 93,000 lures.
1.) Prepare an absorption costing income statement for 2017.