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Delvig [45]
3 years ago
12

Rugrat Company has the following information for the current year: Beginning fixed manufacturing overhead in inventory $190,000

Fixed manufacturing overhead in production 750,000 Ending fixed manufacturing overhead in inventory 50,000 Beginning variable manufacturing overhead in inventory $20,000 Variable manufacturing overhead in production 100,000 Ending variable manufacturing overhead in inventory 30,000 What is the difference between operating incomes under absorption costing and variable costing?
Business
1 answer:
inessss [21]3 years ago
8 0

Answer:

$140,000

Explanation:

The  difference between operating incomes under absorption costing and variable costing based on fixed expenses is shown below:

Variable costing:

Fixed manufacturing overhead in production $750,000

Absorption costing:

The Fixed cost would be

= Beginning fixed manufacturing overhead in inventory + Fixed manufacturing overhead in production - Ending fixed manufacturing overhead in inventory

= $190,000 + $750,000 - $50,000

= $890,000

So, the difference would be

= $890,000 - $750,000

= $140,000

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Union Company reported the following information about the production and sale of its only product during the first month of ope
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C) $200.00

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Thus, we need to Calculate the Total Cost of Goods Manufactured as follows :

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Variable factory overhead                 $60,000

Fixed factory overhead                      $80,000

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                                   =   $400,000 / 2,000

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Note : Total Production = Units Sold <em>plus</em> Ending Finished Goods Inventory

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