Davis Company uses an absorption costing system based on standard costs. Total variable manufacturing costs, including direct
Question:
Davis Company uses an absorption costing system based on standard costs. Total variable manufacturing costs, including direct material and labour costs, are $ ?per unit. The standard production rate is ?units per machinehour.
Total budgeted and actual fixed manufacturing overhead costs are $
Fixed Manufacturing overhead was allocated at $ ?per machinehour. $ ?machinehours at denominator level
The selling price is $ ?per unit.
Variable marketing and administrative costs, which are driven by units sold, are $ ?per unit.
Fixed marketing and administrative costs are $
Beginning inventory in ?was ?units.
Ending inventory in ?is ?units.
Sales in ?are ?units.
So how many did we produce?
The same standard unit costs persisted throughout ?and
Variable overhead spending and efficiency variances total $ ?Unfavourable. No need to calculate these.
Fixed overhead spending variance will calculate to zero.
Calculate Fixed Denominator Production Volume ?variance, if applicable.
REQUIRED:
Prepare an absorption costing income statement for
Prepare a variable costing income statement for
Explain the difference in operating income between the two statements with numbers
Cost Accounting A Managerial Emphasis
ISBN: 978-0133392883
6th Canadian edition
Authors: Horngren, Srikant Datar, George Foster, Madhav Rajan, Christ