Final answer:
To prepare a variable costing income statement for Joplin Company, we must remove fixed manufacturing costs from the cost of goods sold and instead show them as a period expense. The precise variable COGS cannot be determined without the variable manufacturing costs. However, the structure includes subtracting fixed manufacturing costs from total COGS to calculate variable COGS, and then subtracting fixed S&A expenses to calculate variable S&A, and finally listing the fixed costs separately at the bottom.
Step-by-step explanation:
Joplin Company Variable Costing Income Statement
To prepare a variable costing income statement for Joplin Company for the month ended April 30th, we must exclude fixed manufacturing costs from the cost of goods sold and instead show them as a period expense along with selling and administrative expenses.
First, to compute the variable cost of goods sold (COGS), we need to calculate the variable cost per unit. However, since the question does not provide direct information about the variable manufacturing costs, we cannot calculate the precise variable COGS. In a typical setup, we would subtract the fixed manufacturing costs from the total cost of goods manufactured and divide by the number of units produced to get the variable cost per unit.
Next, we calculate the variable selling and administrative expenses by subtracting the fixed selling and administrative expenses from the total given in the absorption costing income statement.
Finally, we list the fixed costs, including both manufacturing and selling and administrative expenses, at the bottom of the income statement.
The variable costing income statement would look something like this:
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- Sales (6,500 units): Amount given
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- Variable Cost of Goods Sold: (Total COGS - Fixed Manufacturing Costs) / Total units produced * Units sold = Variable COGS
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- Gross Profit: Sales - Variable COGS
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- Variable Selling and Administrative Expenses: (Given S&A - Fixed S&A)
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- Net operating income before fixed costs: Gross Profit - Variable S&A
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- Fixed Costs: Fixed Manufacturing + Fixed S&A
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- Operating Income: Net operating income before fixed costs - Fixed Costs
Since the necessary details to calculate variable costs are not provided, we cannot complete the numerical portion of the statement. We can, however, provide the structure and the method to complete the statement once the respective variable costs are identified.