Managerial Accounting: Ex19-28 On June 30, 2016, the end of the first month of operations, Tudor
Managerial AccountingEX 19-28 Absorption costing income statement On June 30, 2016, the end of the first month of operations, Tudor Manufacturing Co. prepared the following income statement, based on the variable costing concept: Sales (420,000 units) 7,450,000 Variable cost of goods sold: Variable cost of goods manufactured (500,000 units x $14 per unit) 7,000,000 Less ending inventory (80,000 units x $14 per unit) 1,120,000 Variable cost of goods sold 5,880,000 Variable selling and administrative expenses 80,000 5,960,000 Contribution margin 1,490,000 Fixed costs: Fixed manufacturing costs 160,000 Fixed selling and administrative expenses 75,000 235,000 Income from operations $1,255,000
A. Prepare an absorption costing income statement. B. Reconcile the variable costing income from operations of $1,255,000 with the absorption costing income from operations determined in (a).