accounting unit 6

This assignment looks at the variable costing income statement and conversion to absorption costing income for two consecutive years.

Use an Excel worksheet to complete the following in your Financial and Managerial Accounting textbook:

· Problem 19-1B, page 876.

roblem 19-1B Variable costing income statement and conversion to absorption costing income (two consecutive years) P2 P3

Azule Company produces a single product. Its income statements under absorption costing for its first two years of operation follow.

Additional Information

a. Sales and production data for these first two years follow:

b.Its variable cost per unit and total fixed costs are unchanged during 2016 and 2017. Its $26 per unit product cost consists of the following.

c.Its selling and administrative expenses consist of the following.

Required

1. Prepare this company’s income statements under variable costing for each of its first two years. Check  (1) 2016 net loss, $(10,000)

2. Explain any difference between the absorption costing income and the variable costing income for these two years.