Castaway Company Reports the Following First Year Production Cost Information

question 63

Essay

Castaway Company reports the following first year production cost information:
$\begin{array}{ll}\text { Units produced } & 53,000 \text { units } \\\text { Units sold } & 51,000 \text { units } \\\text { Sales price } & \$ 150 \text { per unit } \\\text { Direct labor } & \$ 8 \text { per unit } \\\text { Direct materials } & \$ 4 \text { per unit } \\\text { Variable overhead } & \$ 2,173,000 \text { in total } \\\text { Fixed overhead } & \$ 3,339,000 \text { in tota } \\\text { Operating expenses } & \$ 1,000,000 \text { in total }\end{array}$ a.Determine the net income using variable costing.
b.Determine the net income using absorption costing.

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Definitions:

Stratification System

A social structure that divides society into different layers based on socio-economic status, race, ethnicity, or gender.

Ascribed Status

A social position assigned at birth or involuntarily later in life, based on factors like race, family background, and so on, over which the individual has no control.

Class System

The organized pattern of social class in society.

Achieved Status

A social position a person gains through their own efforts or accomplishments, as opposed to ascribed status, which is inherited or assigned at birth.