Absorpstion costing - unit cost

Direct materials $ 240

Direct labor $ 280
BOP-variable $ 100
BOP-fixed $ 40
unit product cost $ 660

COGM = $ 660 x 15,000 = $ 9,900,000

Absorption costing - Income Statement

Salles ($1,300 x 15,000) $ 19,500,000

Cost of good sold
Beginning inv $ 3,300,000
COGM $ 9,900,000
ending inventory $ -
Gross margin $ 6,300,000
S & A expense $ 2,000,000
Operating income $ 4,300,000

Variable costing- unit cost

Direct material $ 240
Direct labor $ 280
BOP Variable $ 100
Unit product cost $ 620

COGM= $ 640 x 15,000 = $ 9,300,000

Variable costing - Income statement

Sales ($ 1,300 x 15,000) $ 19,500,000

Cost of good sold
Beginning inv $ 3,100,000
COGM $ 9,600,000
ending inventory $ -
S & A - variable $ 1,200,000
Contribution margin $ 5,600,000
BOP fixed $ 600,000
S & A - fixed $ 800,000
Operating income $ 4,200,000
produced 15,000
sales 20,000
beginning inv 5,000
ending inv 0