Skinny Dippers inc. produces nonfot frozen yogurt. The product is sold in ten-gallon containers, which have the following price and variable costs: Sales price $44
Diect material 17
Direct labor 9
Variable overhead 11
Budgeted fixed overhead in 20x1, the company's first year of operations, was $240,000 Actual production was 80.000 ten-galion containers, of which 76.000 were sold Skinny Dippers inci incurred the following selling and administrative expenses: Fixed $160.000 for the year
Variable $ 1 per container sold
Required: 1. Compute the product cost per container of frozen yogurt under (o) variable costing and (b) absorption costing
2-a. Prepare an operating income statement for 20×1 using absorption costing 2-b. Prepare an operating income statement for 20×1 using variable costing 3. Reconcie the operating income reported under the two methods by listing the two key ploces where the income statements differ 4. Reconcile the operating income reported under the two methods using the shoncut method