QUESTION# 5 (10marks) For Variable Costing…. there are Proponents (they agree with) of using this Costing...

QUESTION# 5 (10marks) For Variable Costing…. there are Proponents (they agree with) of using this Costing system, and there are Opponents (they don't like it). Please identify 2 reasons from the Proponents, and 2 reasons from the Opponents.

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ekkarill92 answered 1 year ago

Explain the difference between variable costing and absorption costing. Describe the limitations of using variable costing....

Explain the difference between variable costing and absorption costing. Describe the limitations of using variable costing. Describe the limitations of using absorption costing. What difference do you notice on the income statement when prepared with absorption costing versus variable costing? "Managerial Accounting"

QUESTION ONE: Absorption and Variable Costing: Prepare and Reconcile Variable costing Statements Audiophonics Limited manufactures and...

QUESTION ONE: Absorption and Variable Costing: Prepare and Reconcile Variable costing Statements Audiophonics Limited manufactures and sells high-quality and durable ear buds for use with personal electronics that are custom moulded to each customer’s ear. Cost data for the product follows: Variable costs per unit: Direct materials $12 Direct labour 24 Variable factory overhead 8 Variable selling and administrative 6 Total variable costs per unit $50 Fixed costs per month: Fixed manufacturing overhead $240,000 Fixed selling and administrative 180,000 Total fixed costs per month $420,000 The product sells...

1. Determine the following information using absorption costing and variable costing: Absorption costing a. Manufacturing cost...

1. Determine the following information using absorption costing and variable costing: Absorption costing a. Manufacturing cost _______________ b. Per-unit cost _______________ c. Cost of ending inventory _______________ Variable costing a. Manufacturing cost _______________ b. Per-unit cost _______________ c. Cost of ending inventory _______________ Basic facts: Direct materials $1,000 Direct labor $2,000 Variable overhead $1,500 Fixed overhead $1,000 Units produced 100 Units sold 80 No beginning inventory 2. What is the prime cost per unit and conversion cost per unit: a....

Cost of Goods Manufactured, using Variable Costing and Absorption Costing On March 31, the end of...

Cost of Goods Manufactured, using Variable Costing and Absorption Costing On March 31, the end of the first year of operations, Barnard Inc., manufactured 3,700 units and sold 3,200 units. The following income statement was prepared, based on the variable costing concept: Barnard Inc. Variable Costing Income Statement For the Year Ended March 31, 20Y1 Sales $1,024,000 Variable cost of goods sold: Variable cost of goods manufactured $569,800 Inventory, March 31 (77,000) Total variable cost of goods sold (492,800) Manufacturing...

Cost of Goods Manufactured, using Variable Costing and Absorption Costing On December 31, the end of...

Cost of Goods Manufactured, using Variable Costing and Absorption Costing On December 31, the end of the first year of operations, Frankenreiter Inc., manufactured 2,400 units and sold 2,100 units. The following income statement was prepared, based on the variable costing concept: Frankenreiter Inc. Variable Costing Income Statement For the Year Ended December 31, 20Y1 Sales $588,000 Variable cost of goods sold: Variable cost of goods manufactured $321,600 Inventory, December 31 (40,200) Total variable cost of goods sold 281,400 Manufacturing...

What is the difference between full absorption of costing and variable costing? Why is using GAAP...

What is the difference between full absorption of costing and variable costing? Why is using GAAP is required for one of the costings while the other makes sense for making internal making choices? Discuss benefits and disadvantages of each one for the external and internal use.

Variable Costing

Using Variable Costing to prepare an Income Statement and using the same method to calculate the Unit Production Cost.

What is variable costing and how are variable costing and absorption costing used for different purposes?...

What is variable costing and how are variable costing and absorption costing used for different purposes? Why is net income different when variable costing is used rather than absorption costing?

1.1 List and explain the 5 categories of price elasticity of demand (10Marks) 1.2 Briefly explain...

1.1 List and explain the 5 categories of price elasticity of demand (10Marks) 1.2 Briefly explain any determinants of the price elasticity of demand 1.3 With the aid of fully labelled diagrams, explain how a perfectly competitive firms adjust to earning only normal profits in the long run from a position of economic profit/loss in the short run(10marks)

Absorption and variable costing:

The Dorset Corporation produces and sells a single product. The following data refer to the year just completed:Beginning inventory 0Units produced 9,000Units sold 7,000Selling price per unit $ 47Selling and administrative expenses:Variable per unit $ 4Fixed per year $ 58,000Manufacturing costs:Direct materials cost per unit $ 10Direct labor cost per unit $ 6Variable manufacturing overhead cost per unit $ 5Fixed manufacturing overhead per year $ 90,000Assume that direct labor is a variable cost.Required:a. Prepare an income statement for the year...

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