calculations listed below. • Calculate the value of ending inventory under full or absorption costing. • Calculate the value of ending inventory under variable costing. Which method you think is more helpful to managers and why.
calculations listed below. • Calculate the value of ending inventory under full or absorption costing. • Calculate the value of ending inventory under variable costing. Which method you think is more helpful to managers and why.
Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter4: Accounting For Factory Overhead
Section: Chapter Questions
Problem 4P: Using the data in P4-2 and Microsoft Excel: 1. Separate the variable and fixed elements. 2....
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Part 2: Based on the data presented in the Unit VII Spreadsheet Template in Excel (Full Variable tab), complete the
calculations listed below.
• Calculate the value of ending inventory under full or absorption costing.
• Calculate the value of ending inventory under variable costing.
Which method you think is more helpful to managers and why.
Cookie Business | |
Productions Costs: | |
Direct material | $ 0.60 |
Direct labor | $ 1.00 |
Variable manufacturing overhead | $ 0.40 |
Total variable |
$ 2.00 |
Fixed manufacturing overhead per year | $ 139,000.00 |
In addition, the company has fixed selling and administrative costs: | |
Fixed selling costs per year | $ 50,000.00 |
Fixed administrative costs per year | $ 65,000.00 |
Selling price per cookie | $ 3.75 |
Number of cookies produced | 2,780,000 |
Number of cookies sold | 2,600,000 |
Full (absorption) costing : | |
Full cost per unit | |
Ending Inventory Full (absorption) costing | |
Variable costing : | |
Variable cost per unit | |
Ending Inventory Variable costing |
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