Required: a) Prepare the income statement for the year ended December 31, 2012 using i) Absoption costing.
Required: a) Prepare the income statement for the year ended December 31, 2012 using i) Absoption costing.
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Thotho manufactures headscarves. The following information is available in her books on
December 31, 2012.
| BW | |
| Opening inventory | 1500 |
| Headscarves made during the year | 9000 |
| Head scarves sold during the year | 9500 |
| Closing inventory | 1000 |
| Selling price | 90 |
| Variable costs | |
|
25 |
|
9 |
| make one scarf | 5 |
|
15000 |
| Fixed manufacturing overhead per year | |
| Selling and administrative costs: | |
| Commission paid for selling one scarf | 10 |
| fixed selling and administration costs per year | 100000 |
Required:
a) Prepare the income statement for the year ended December 31, 2012 using
i) Absoption costing.
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