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Runway Fashions Inc.

Please answer question 20-3 (only)Part a,b,c/ please perform the problem in exel.

EX 20-3 Runway Fashions Inc. manufactures and sells women's clothes. The company began operations on August 1, 2009, and operated at 100% of capacity (35,000 units) during the fist month, creating an ending inventory of 2,500 units. During September, the company produced 32,500 garments during the month but sold 35,000 units at $115 per unit. The September manufacturing costs and selling and administrative expenses were as follows:

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EX 20-3 Runway Fashions Inc. manufactures and sells women's clothes. The company began operations on August 1, 2009, and operated at 100% of capacity (35,000 units) during the fist month, creating an ending inventory of 2,500 units. During September, the company produced 32,500 garments during the month but sold 35,000 units at $115 per unit. The September manufacturing costs and selling and administrative expenses were as follows:

Number of
Total Cost Units Produced Unit Cost
Manufacturing costs in Sept. beginning inventory:
Variable 115,000 2,500 46
Fixed 32,500 2,500 13
Total 147,500 59

September manufacturing ...

Solution Summary

This solution is comprised of a detailed explanation to prepare an income statement according to the absorption costing concept for September.

$2.19