The Variable Costing Income Statement for Kilem Company for This

question 43

Essay

The variable costing income statement for Kilem Company for this year is as follows: Selected data for this year concerning the operations of the company are as follows: $\begin{array}{lr}\text { Beginning inventory } & -0 \text { - units } \\\text { Units produced } & 8,000 \text { units }\\\text { Manufacturing costs: } & \\\text { Direct labour } & \$ 3.00 \text { per unit } \\\text { Direct materials } & 1.40 \text { per unit } \\\text { Variable overhead } & 1.60 \text { per unit }\end{array}$ Required: Prepare an absorption costing income statement for this year.

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Definitions:

Bankruptcy Court

A specialized court that deals with cases involving bankruptcy filings and related proceedings.

Final Settlement

The last payment in an agreement, settling all outstanding balances and obligations.

Section 179

A provision in the U.S. tax code that allows businesses to deduct the full purchase price of qualifying equipment and/or software within the tax year it was purchased.

Maximum Deduction

The highest amount that can be subtracted from taxable income, as allowed by tax laws.