Answer:
1. 6,000
2. 7,200
Explanation:
1. Calculation to determine how much of the ending inventory consists of fixed manufacturing overhead cost deferred in inventory to the next period.
Using this formula
Ending inventory=Fixed manufacturing overhead/Units produced*Ending units
Let plug in the formula
Ending inventory=62,000/310*30
Ending inventory=6,000
Therefore how much of the ending inventory consists of fixed manufacturing overhead cost deferred in inventory to the next period is 6,000
2. Preparation of an income statement for the year using variable costing.
IDA SIDHA KARYA Company Variable Costing Income Statement
Units produced cost (130+350+50=530)
Sales $254,800
(280*910)
VARIABLE EXPENSES:
Variable cost of goods sold $148,400
(280*530)
Variable selling and administrative expense $11,200
(280*40)
Contribution margin $95,200
($254,800-$148,400-$11,200)
FIXED EXPENSES:
Fixed manufacturing overhead $62,000
Fixed selling and administrative expense $26,000
Net operating income $7,200
($95,200-$62,000-$26,000)
Therefore the income statement for the year using variable costing is $7,200
