Stamp Bottling Works manufactures glass bottles. January began with 15,000 units carried at ...

January manufacturing cost per unit:

Beginning inventory [(($108,750-(15,000 x$4))/15,000] + $4   $ 7.25
Production ($119,000/35,000) + $4    $ 7.40
    
February manufacturing cost per unit:
Beginning inventory   $ 7.40
Production ($132,000/40,000) + $4   $ 7.30   
   Income Statement
   January
Sales (45,000 × $10)      $450,000
Cost of goods sold (15,000 × $7.25) + (30,000 × $7.40)   330,750
Gross margin      $119,250
Other costs:
Variable selling and administrative   $18,000
Fixed selling and administrative   60,000   78,000
Operating income      $41,250

   Income Statement
   February
Sales (45,000 × $10)      $450,000
Cost of goods sold (5,000 × $7.40) + (40,000 × $7.30)   329,000
Gross margin      $121,000
Other costs:
Variable selling and administrative   $18,000
Fixed selling and administrative   60,000   78,000
Operating income      $43,000