On January 1 of the current year, Townsend Co. began operations. It operated its plant at 100% capacity during January.

On January 1 of the current year, Townsend Co. began operations. It operated its plant at 100% capacity during January.

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On January 1 of the current year, Townsend Co. began operations. It operated its plant at 100% capacity during January.
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On January 1 of the current year, Townsend Co. began operations. It operated its plant at 100% capacity during January. The following data summarizes the results for JanuaryUnitsProduction50,000Sales ($18 per unit)42,000Inventory, January 318,000Manufacturing costs:Variable$ 575,000Fixed80.000Total$655,000Selling and administration expenses:Variable$35,000Fixed10,500Total$ 45,500Required:(a)Prepare an income statement using absorption cost.*(b)Prepare an income statement using variable costs.**See lists of labels and amount descriptions for exact wording of answer options for text entries. Be sure to complete the declaration header. “Less” or “More” will automatically appear if necessary. You will not need to enter a colon (:) in financial statements. If a net loss is incurred, enter that amount as a negative number using a minus sign.XAbsorption Costs Income StatementPrepare an income statement using the absorption cost. See the label lists and quantity descriptions for the exact text of the answer options for text entries. Be sure to complete the declaration header. “Less” or “More” will automatically appear if necessary. You will not need to enter a colon (:) in financial statements. If a net loss is incurred, enter that amount as a negative number using a minus sign.Townsend Co.Absorption Costs Income Statement12Cost of goods sold:345678Hang tagsFixed costsFor the month ended January 31, 20–Quantity DescriptionsContribution margincost of manufactured goodscost of goods soldFixed manufacturing costsFixed selling and administrative expensesGross profitoperating incomeInventory, January 31, 20–manufacturing marginSalesSelling and administrative expensesVariable cost of manufactured goodsvariable cost of goods soldVariable selling and administrative expensesPrepare an income statement using the absorption cost. See the label lists and quantity descriptions for the exact text of the answer options for text entries. Be sure to complete the declaration header. “Less” or “More” will automatically appear if necessary. You will not need to enter a colon (:) in financial statements. If a net loss is incurred, enter that amount as a negative number using a minus sign.Townsend Co.Absorption Costs Income Statement12Cost of goods sold:345678Prepare an income statement using the absorption cost. See the label lists and quantity descriptions for the exact text of the answer options for text entries. Be sure to complete the declaration header. “Less” or “More” will automatically appear if necessary. You will not need to enter a colon (:) in financial statements. If a net loss is incurred, enter that amount as a negative number using a minus sign.Townsend Co.Absorption Costs Income Statement12Cost of goods sold:345678XVariable Cost Income StatementPrepare an income statement using variable cost. See the label lists and quantity descriptions for the exact text of the answer options for text entries. Be sure to complete the declaration header. “Less” or “More” will automatically appear if necessary. You will not need to enter a colon (:) in financial statements. If a net loss is incurred, enter that amount as a negative number using a minus sign.Townsend Co.Variable Cost Income Statement12Variable cost of goods sold:3456789101112

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1 Absorption Costing Income Statement Townsend Co Absorption Costing Income Statement For the Month Ended January Amount Sales 42 000 Units x 18 756 0
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