Merry Company produces clothes. One of the company's products is KIKILULU Skirts which are sold for RM90 each. • The standard cost of producing 100 units of KIKILULU skirt is shown below: RM Direct labour 500 Direct material 2,000 Variable production overhead 1,200 Fixed production overhead 1,800 TOTAL 5,500 • Production and inventory data during the month of October 2021 is given below: Units Unit production 5000 Opening inventory 10,000 Closing inventory 8,000 • The company's normal production is 120,000 units per annum. • Fixed production overhead cost spread evenly over the year. • The fixed selling and distribution cost per year is RM78,000. Variable selling and distribution cost is RM5.00 per unit.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question
(b)
Merry Company produces clothes. One of the company's products is
KIKILULU Skirts which are sold for RM90 each.
The standard cost of producing 100 units of KIKILULU skirt is shown
below:
RM
Direct labour
500
Direct material
2,000
Variable production overhead 1,200
Fixed production overhead
1,800
ТОTAL
5,500
Production and inventory data during the month of October 2021 is
given below:
Units
Unit production
5000
Opening inventory
10,000
Closing inventory
8,000
• The company's normal production is 120,000 units per annum.
• Fixed production overhead cost spread evenly over the year.
• The fixed selling and distribution cost per year is RM78,000. Variable
selling and distribution cost is RM5.00 per unit.
Transcribed Image Text:(b) Merry Company produces clothes. One of the company's products is KIKILULU Skirts which are sold for RM90 each. The standard cost of producing 100 units of KIKILULU skirt is shown below: RM Direct labour 500 Direct material 2,000 Variable production overhead 1,200 Fixed production overhead 1,800 ТОTAL 5,500 Production and inventory data during the month of October 2021 is given below: Units Unit production 5000 Opening inventory 10,000 Closing inventory 8,000 • The company's normal production is 120,000 units per annum. • Fixed production overhead cost spread evenly over the year. • The fixed selling and distribution cost per year is RM78,000. Variable selling and distribution cost is RM5.00 per unit.
(i)
Prepare Operating Income Statement for the month of October 2021
using Marginal Costing Approach.
(ii)
Prepare Operating Income Statement for the month of October 2021
using Absorption Costing Approach.
Transcribed Image Text:(i) Prepare Operating Income Statement for the month of October 2021 using Marginal Costing Approach. (ii) Prepare Operating Income Statement for the month of October 2021 using Absorption Costing Approach.
Expert Solution
steps

Step by step

Solved in 3 steps with 2 images

Blurred answer
Knowledge Booster
Cost Sheet
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education