Joplin Industries Inc manufactures and sells highquality spo

Joplin Industries Inc. manufactures and sells high-quality sporting goods equipment under its highly recognizable J-Sports ogo. The company began operations on May 1 and operated at 100% of capac ty 74,800 units during the first month, creating an ending inventory of 6,800 units. During June, the compamy produced 68,000 garments during the month but sold 74,800 units at $120 per unit. The June manufacturing costs and selling and administrative expenses were as follows: Total Number of Unit Cost Units Cost Manufacturing costs in June 1 beginning inventory: 6,800 $48.00 326,400 6,800 18.00 122,400 $66.00 $448,800 Varable Fixed Total Manufacturing costs in June: Variable 68,000 $48.00 $3,264,000 19.80 1,346,400 67.80 4,610,400 Fixed 68,000 Total Selling and administrative expenses in June Variable 74,B00 23.40 $1,750,320 7.00 523,600 30.40 $2,273,920 Fixed 74,B00 Total

Solution

Joplin Industries Corporation Absorption costing Income Statement. For the month ended 30th June Particulars Amount Amount Sales Revenue (74,800units* $120 per unit) 8,976,000 Less: Cost of Goods Sold.            Manufacturing Cost(68,000units*$[49+19.80]) 4,610,400            Add: Opening Inventory(6,800units*$[48+18]) 4,48,800            Less: Closing Inventory. Nil 5,059,200 Gross Margin: 3,916,800 Less: Non Manufacturing Cost            Variable Selling and Administrative Exp 17,50,320                    (74,800 units * $23.40)            Fixed Selling and Administrative Exp 5,23,600 2,273,920                    (74,800 units * $7.00) Net Income: 1,642,880 Joplin Industries Corporation Variable costing Income Statement. For the month ended 30th June Particulars Amount Amount Sales Revenue (74,800units* $120 per unit) 8,976,000 Less: Variable Expenses            Variable Cost of Goods sold 3,590,400 [(6,800units* $48) + (68,000* $48)]            Variable Selling and Administrative Exp 1,750,320 5,340,720                    (74,800 units * $23.40) Contribution Margin 3,635,280 Less: Fixed Expenses               Fixed Manufacturing Cost 1,468,800 [(6,800units* $18) + (68,000* $19.80)]            Fixed Selling and Administrative Exp 523,600 19,92,400                    (74,800 units * $7.00) Net Operting Income: 16,42,880