Differences in operating profit between variable and absorption costing are due solely to accounting for fixed costs.

Question:

Differences in operating profit between variable and absorption costing are due solely to accounting for fixed costs. Do you agree? Explain.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Management and Cost Accounting

ISBN: 978-1405888202

4th edition

Authors: Alnoor Bhimani, Charles T. Horngren, Srikant M. Datar, George Foster

See More Books

Question Posted: Oct 25, 2016 10:18 AM

See More Questions

GrwnPwr, a privately held startup company, designs and manufacturers patented electrodes for electric-powered vehicle batteries. GrwnPwr's patented electrodes allow battery makers to produce lighter...
Multiple Choice Questions 1. Murdocks Munchies has the following cost information: Variable S&A costs .........$2.00 per unit Direct materials ............$7.50 per unit Variable overhead...
What are the differences between variable and absorption costing? Why is variable costing not allowed for GAAP reporting? Which method is more useful for internal decision making? Why? As a manager,...
(a) An n n matrix K is the encryption matrix for the Hill cipher. Give the encryption formula. (b) The plaintext is (2, 5, 1,0). Encrypt it (show your work and the ciphertext) using the Hill cipher...
In 2004 during the war in Iraq, some MNCs capitalized on opportunities to rebuild Iraq. However, in April 2004, some employees were kidnapped by local militant groups. How should an MNC account for...
Various types of "accounting changes" can affect the second reporting standard of the generally accepted auditing standards. This standard reads, "The auditor must identify in the auditor's report...
The Lewis-Randall rule is applicable (a) At high pressures (b) At low pressures when the gas mixture behaves as an ideal solution (c) At low temperature (d) At low temperature and high pressure.
The comparative balance sheets for Yanik Company as of December 31 are presented below. Additional information: 1. Operating expenses include depreciation expense of $42,000. 2. Land was sold for...
The Sales Manager said he didn't have authority to match that low a price- Kevin would have to wait until Charles Cabot got home and ask him. The Sales Manager also reminded Kevin that Charles really...
A microwave oven (Figure 13.9) uses microwaves with a wavelength of 12.5 cm. The front door of the oven is made of glass with a metal grid inside; the gaps in the grid are a few millimetres across....
Which joint-cost-allocation method is supported by the cause-and-effect criterion for choosing among allocation methods?
Name one reason why many companies prefer the master-budget utilization-level concept rather than the normal utilization-level concept.
An industrial press is mounted on a rubber pad to isolate it from its foundation. If the rubber pad is compressed $5 \mathrm{~mm}$ by the self weight of the press, find the natural frequency of the...
Despite layoffs and recession-starved budgets, many employers are investing in leadership-development programs, hoping not to be caught short of strong managers when the economy recovers. Identifying...
The nations business leaders are confronting a confusing and stark reality. Few have ever faced such calamitous circumstances. A daunting task lies before them: making sure their corporations survive...
Intel has restructured and eliminated about 10,500 jobs during the past 20 months. The company decided to make these cuts owing to declining revenue and market share. Intel used a quantitative...
In late 2006. Irdeto Holdings BV Chief Executive Graham Kill concluded his company could no longer be run from an Amsterdam suburb. Sales at Irdeto, a unit of South American media group Naspers Ltd....
Indra Nooyi is an entirely different kind of CEO, a product of her native India as well as of PepsiCos family values approach to grooming CEOs. She is not hung up on pay. Shes not shy about asking...
For R = {(x, y) | - 1 x 1, 1 y 2}, evaluate the following in two ways: (4 + ) dA R
Find the area of the surface generated by revolving the para- metric curve x = cos 1, y = sin? 1 (0 < I sa/2) about the y-axis.
Refer to the preceding problem. Required 1. How would the answer to the preceding problem be modified if you were asked for a schedule of cost of goods manufactured and sold instead of a schedule of...
Zimmermann GmbH is an international consulting firm. Its annual budget includes the following for each category of professional labor: Required 1. Calculate the budgeted direct-cost rate for...
Tricheur et Associés is a recently formed law partnership. Jean Racine, the managing partner of Tricheur et Associés, has just finished a tense telephone call with Blaise Rascal,...
Fixed cost per unit is $7 when 25,000 units are produced and $5 when 35,000 units are produced. What is the total fixed cost when nothing is produced?
Menlo Company distributes a single product. The company's sales and expenses for last month follow: Total Per Unit Sales $316,000 $20 Variable expenses 221,200 14 Contribution margin 94,800 $ 6 Fixed...
Shown are selected financial data for Another World and Imports, Inc., at the end of the current year. Net credit sales Cost of goods sold Cash Another World Imports, Inc. $ 675,000 $560,000 504,000...

Differences in operating profit between variable and absorption costing are due solely to accounting for fixed costs.

Question:

Step by Step Answer:

Hence for the final analysis we can say that No Differe...View the full answer

Management and Cost Accounting

Students also viewed these Managerial Accounting questions