Question

73 The level of inventory of a manufactured product has increased by 7,847 units during a...

73

The level of inventory of a manufactured product has increased by 7,847 units during a period. The following data are also available:

Variable Fixed
Unit manufacturing costs of the period $13 $7
Unit operating expenses of the period $2 $3

What would be the effect on income from operations if variable costing is used rather than absorption costing?

a.$54,929 decrease

b.$78,470 decrease

c.$78,470 increase

d.$54,929 increase

72-

The level of inventory of a manufactured product has increased by 8,505 units during a period. The following data are also available:

Variable Fixed
Unit manufacturing costs of the period $14 $6
Unit operating expenses of the period $4 $5

What would be the effect on income from operations if absorption costing is used rather than variable costing?

a.$51,030 increase

b.$51,030 decrease

c.$93,555 decrease

d.$93,555 increase

Homework Answers

Answer #1

1

Answer: $54929 decrease

Working notes for the answer

Total cost if variable cost is used =13+2=15

Total cost if absorption cost is used =13+2+7=22

Effect on income

=22-15* 7847

=7*7847

=54929

A.$54,929 decrease

_________________________________________

2

Answer: .$51,030 increase

Working notes for the answer

Total cost if variable cost is used =14+4=18

Total cost if absorption cost is used =14+4+6=24

Effect on income

=24-18* 8505

=6*8505

=51030

a.$51,030 increase

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
The level of inventory of a manufactured product has increased by 8,000 units during a period....
The level of inventory of a manufactured product has increased by 8,000 units during a period. The following data are also available: Variable Fixed Unit manufacturing costs of the period $24.00 $10.00 Unit operating expenses of the period 8.00 3.00 What would be the effect on income from operations if variable costing is used rather than absorption costing? a.$80,000 increase b.$104,000 increase c.$104,000 decrease d.$80,000 decrease
The level of inventory of a manufactured product has increased by 8,319 units during a period....
The level of inventory of a manufactured product has increased by 8,319 units during a period. The following data are also available: Variable Fixed Unit manufacturing costs of the period $13 $8 Unit operating expenses of the period $2 $3 What would be the effect on income from operations if variable costing is used rather than absorption costing? a.$91,509 decrease b.$66,552 increase c.$66,552 decrease d.$91,509 increase
The level of inventory of a manufactured product has increased by 8,731 units during a period....
The level of inventory of a manufactured product has increased by 8,731 units during a period. The following data are also available: Variable Fixed Unit manufacturing costs of the period $11 $7 Unit operating expenses of the period $1 $1 What would be the effect on income from operations if absorption costing is used rather than variable costing? a. $61,117 increase b. $61,117 decrease c. $69,848 increase d. $69,848 decrease
The level of inventory of a manufactured product has increased by 8,401 units during a period....
The level of inventory of a manufactured product has increased by 8,401 units during a period. The following data are also available: Variable Fixed Unit manufacturing costs of the period $14 $5 Unit operating expenses of the period $4 $3 What would be the effect on income from operations if absorption costing is used rather than variable costing?
38. A. The level of inventory of a manufactured product has increased by 8,070 units during...
38. A. The level of inventory of a manufactured product has increased by 8,070 units during a period. The following data are also available: Variable Fixed Unit manufacturing costs of the period $10 $4 Unit operating expenses of the period $1 $5 What would be the effect on income from operations if variable costing is used rather than absorption costing? a. $72,630 decrease b. $72,630 increase c. $32,280 increase d. $32,280 decrease 38. B. Consider Derek's budget information: materials to...
78 - A business operated at 100% of capacity during its first month and incurred the...
78 - A business operated at 100% of capacity during its first month and incurred the following costs: Production costs (20,800 units): ??? Direct materials $171,700 ??? Direct labor 222,500 ??? Variable factory overhead 244,200 ??? Fixed factory overhead 93,900 $732,300 Operating expenses: ??? Variable operating expenses $129,800 ??? Fixed operating expenses 42,500 172,300 If 2,000 units remain unsold at the end of the month, what is the amount of inventory that would be reported on the variable costing balance...
3). A business operated at 100% of capacity during its first month and incurred the following...
3). A business operated at 100% of capacity during its first month and incurred the following costs: Production costs (17,900 units): ??? Direct materials $173,200 ??? Direct labor 237,200 ??? Variable factory overhead 260,600 ??? Fixed factory overhead 97,300 $768,300 Operating expenses: ??? Variable operating expenses $134,800 ??? Fixed operating expenses 46,700 181,500 If 1,800 units remain unsold at the end of the month, what is the amount of inventory that would be reported on the absorption costing balance sheet?...
At EOM Inc., the beginning inventory is 20,000 units. All of the units manufactured during the...
At EOM Inc., the beginning inventory is 20,000 units. All of the units manufactured during the period and 16,000 units of the beginning inventory were sold. The beginning inventory fixed costs are $50 per unit, and variable costs are $300 per unit. a. Determine whether variable costing income from operations is less than or greater than absorption costing income from operations. b. Determine the difference in variable costing and absorption income from operations. $
Variable Costing—Sales Exceed Production The beginning inventory is 14,200 units. All of the units that were...
Variable Costing—Sales Exceed Production The beginning inventory is 14,200 units. All of the units that were manufactured during the period and 14,200 units of the beginning inventory were sold. The beginning inventory fixed manufacturing costs are $35 per unit, and variable manufacturing costs are $84 per unit. a. Determine whether variable costing income from operations is less than or greater than absorption costing income from operations. b. Determine the difference in variable costing and absorption costing income from operations. $
On December 31, the end of the first year of operations, Frankenreiter Inc., manufactured 2,700 units...
On December 31, the end of the first year of operations, Frankenreiter Inc., manufactured 2,700 units and sold 2,300 units. The following income statement was prepared, based on the variable costing concept: Frankenreiter Inc. Variable Costing Income Statement For the Year Ended December 31, 20Y1 Sales $805,000 Variable cost of goods sold: Variable cost of goods manufactured $453,600 Inventory, December 31 (67,200) Total variable cost of goods sold 386,400 Manufacturing margin $418,600 Total variable selling and administrative expenses 96,600 Contribution...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT