The Following Data Is Related to Sales and Production of the Welch

Essay

The following data is related to sales and production of the Welch Corporation for last year.
$\begin{array}{|l|r|}\hline \text { Selling price per unit } & \$ 50.00 \\\hline \text { Variable manufacturing cost per unit } & \$ 24.00 \\\hline \text { Variable selling and administrative expense per unit } & \$ 4.00 \\\hline \text { Fixed manufacturing overhead (in total) } & \$ 50,000 \\\hline \text { Fixed selling and administrative expenses (in total) } & \$ 8,000 \\\hline \text { Units produced during year } & 10,000 \\\hline \text { Units sold during year } & 9,000 \\\hline \text { Units in beginning inventory } & 0 \\\hline \text { Units in ending inventory } & 1,000\\\hline \end{array}$
Required:
a.Prepare an income statement for last year using absorption costing.
b.Calculate the value of the ending inventory using absorption costing.
c.Prepare an income statement for last year using variable costing.
d.Calculate the value of the ending inventory using variable costing.
Answer