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Absorption and Variable costing for AFN Products

Please review my computations. I need help with part D, please.

AFN produces plastic that is used for injection molding applications such as gears for small motors. In 2002, the first year of operations, AFN produced 4,000 tons of plastic and sold 3,000 tons. In 2003, the productin and sales results were exactly reversed. In each year, selling price per ton was $2,000, variable manufacturing costs were 15% of teh sales price of units produced, variable seling expenses were 10% of the selling price of units sold, fixed manufacturing costs were $2,400,000, an dfixed administrative expenses were $600,000...

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Solution Summary

The solution explains how the prepare income statements using variable costing and absorption costing and the difference between them