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Unformatted text preview: $48,000 variable costing ending inventory) OR (600 violins $20 fixed manufacturing cost per violin)] is trapped on the balance sheet rather than expensed as part of cost of goods sold in the current period. This $12,000 of cost will flow through the absorption income statement when the violins are sold. Precious Pets Contribution Margin Income Statement Precious Pets Contribution Margin Income Statement For the Year Ended December 31 Sales revenue $987,000 Variable expenses: Cost of goods sold 665,000 Variable selling and marketing expenses 27,400 Variable web site maintenance expenses 14,000 Other variable operating expenses 1,700 Total variable expenses 708,100 Contribution margin 278,900 Fixed expenses: Fixed selling and marketing expenses 33,600 Fixed web site maintenance expenses 42,000 Other fixed operating expenses 15,300 Total fixed expenses 90,900 Operating income $188,000...
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