Wiengot Antennas, Inc., produces and sells a unique type of TV antenna. The company has just opened a new plant to manufacture the antenna, and the following cost and revenue data have been provided for the first month of the plant%u2019s operation.
|
|
|
| Beginning inventory |
|
0 |
| Units produced |
|
44,000 |
| Units sold |
|
39,000 |
| Selling price per unit |
|
$80 |
| Selling and administrative expenses: |
|
|
| Variable per unit |
|
$2 |
| Fixed (total) |
$ |
567,000 |
| Manufacturing costs |
|
|
| Direct materials cost per unit |
|
$17 |
| Direct labor cost per unit |
|
$8 |
| Variable manufacturing overhead cost per unit |
|
$2 |
| Fixed manufacturing overhead cost (total) |
$ |
792,000 |
|
|
Because the new antenna is unique in design, management is anxious to see how profitable it will be and has asked that an income statement be prepared for the month.
|
| 1. |
Assume that the company uses absorption costing. |