Chilly Chips,Inc.,a producer of ice cream,began operations this year.During this year,the company produced 160,000 cartons of ice cream and sold 145,000.At year-end,the company reported the following income statement using absorption costing:
Production costs per carton total $3.50,which consists of $2.30 in variable production costs and $1.20 in fixed production costs (based on the 160,000 units produced).Sixty percent of total selling and administrative expenses are variable.Compute net income under variable costing.

Question

Chilly Chips,Inc.,a producer of ice cream,began operations this year.During this year,the company produced 160,000 cartons of ice cream and sold 145,000.At year-end,the company reported the following income statement using absorption costing:
  Production costs per carton total $3.50,which consists of $2.30 in variable production costs and $1.20 in fixed production costs (based on the 160,000 units produced).Sixty percent of total selling and administrative expenses are variable.Compute net income under variable costing.

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The Answer of Chilly Chips,Inc.,a producer of ice cream,began operations this year.During this year,the company produced 160,000 cartons of ice cream and sold 145,000.At year-end,the company reported the following income statement using absorption costing:
  Production costs per carton total $3.50,which consists of $2.30 in variable production costs and $1.20 in fixed production costs (based on the 160,000 units produced).Sixty percent of total selling and administrative expenses are variable.Compute net income under variable costing.