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3 years ago

PA15.

Business

1 answer:

ser-zykov [4K]3 years ago

3 0

Answer:

Happy Trails

Income statement using variable costing

$ $

Sales 1,900,500

Less: Variable costs:

Direct material (27,000 units x $15) 405,000

Direct labour (27,000 units x $15) 405,000

Variable overhead (27,000 units x $3) 81,000

891,000

Less: Closing stock (8,000 units x $33) 264,000

627,000

Add: Variable selling and administrative 133,000 760,000

Contribution 1,140,500

Less: Fixed cost:

Fixed production cost (27,000 x $25) 675,000

Fixed selling and administrative expenses 300,000 975,000

Net profit 165,500

Profit reconciliation statement

Closing stock Net profit

$ $

Absorption costing 464,000 365,500

Less: Marginal costing 264,000 165,500

Difference 200,000  200,000

The difference of $200,000 in net profit is as a result of $200,000 difference in closing inventory.

Explanation:

In variable costing, variable costs are deducted from sales so as to obtain contribution margin. Net profit is the difference between contribution and fixed costs. Closing stock is the difference between production units and sales units. Closing stock is valued at marginal cost per unit in variable costing. Marginal cost per unit is the aggregate of all variable cost per unit.

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1 year ago

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Answer:

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3 years ago

Which best describes how advertising influences consumer choice in an oligopoly?

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Answer:

• Advertising undermines competition.

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3 years ago

When a company sells property and then leases it back, any gain on the sale should usually bea. deferred and recognized as incom

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3 years ago