Lynch Company manufactures and sells a single product. The following costs were incurred during the company’s first year of operations: Variable costs per unit: Manufacturing: Direct materials $6Direct labor $9Variable manufacturing overhead $3Variable selling and administrative $4Fixed costs per year: Fixed manufacturing overhead$300,000Fixed selling and administrative$190,000 During the year, the company produced 25,000 units and sold 20,000 units. The selling price of the company’s product is $50 per unit. Required:1. Assume that the company uses absorption costing:a. Compute the unit product cost. b. Prepare an income statement for the year.2. Assume that the company uses variable costing:a. Compute the unit product cost. b. Prepare an income statement for the year.

Instructions are below.

Explanation:

Giving the following information:

Variable costs per unit:

Direct materials $6

Direct labor $9

Variable manufacturing overhead $3

Variable selling and administrative $4

Fixed costs per year:

Fixed manufacturing overhead$300,000

Fixed selling and administrative $190,000

During the year, the company produced 25,000 units and sold 20,000 units.

The selling price of the company’s product is $50 per unit.

The difference between the absorption costing and variable costing methods is that the first one includes the fixed manufacturing overhead to the product cost.

1) Absorption costing:

Unitary fixed overhead= 300,000/25,000= $12 per unit

Unitary product cost= 6 + 9 + 3 + 12= $30

Income statement:

Sales= 20,000*50= 1,000,000

COGS= (20,000*30)= (600,000)

Gross profit= 400,000

Total selling and administrative= (190,000 + 20,000*4)= (270,000)

Net income= 130,000

2) Variable costing method:

Unitary variable cost= 6 + 9 + 3= $18

Income statement:

Sales= 1,000,000

Variable cost= (20,000*22)= (440,000)

Contribution margin= 560,000

Fixed manufacturing overhead= (300,000)

Fixed selling and administrative= (190,000)

net income= 70,000

ans.

heterothermic organisms include those organisms that can switch between homeothermic (having body temperature higher than environment) and poikilothermic (having variation in internal body temperature) strategies.

some migratory birds show heterothermy as they decrease their metabolic rate during cold nights to keep their body temperature low. drop in metabolic rate allows increase in production efficiency of birds that reduces the internal body temperature to make it equal to external cold temperature during cold nights.

thus, the correct answer is 'birds allow their temperature drop in order to increase their production efficiency.'

answer; (cash) is the best out of the above; good luck