The level of inventory of a manufactured product has increased by 7,819 units during a period. The following data are also available:   Variable Fixed Unit manufacturing costs of the period $13.00  $8.00  Unit operating expenses of the period 1.00  3.00  The effect on operating income if variable costing is used rather than absorption costing would be a(n) a.$86,009 increase b.$86,009 decrease c.$62,552 decrease d.$62,552 increase

Q: A manufacturing company that produces a single product has provided the following data concerning…

A: Unit costs include all manufacturing fixed and variable cost. Variable costs are flexible as per…

Q: The level of inventory of a manufactured product has increased by 7,616 units during a period. The…

A: Decrease in operating income if variable costing is used = Increase in level of inventory x fixed…

Q: ronman Company had a net income of P85,000 using variable costing and net income of P90,000 using…

A: Variable costing method is methods of cost accounting technique in which fived overhead costs are…

Q: During the year, FITA Corporation produced 500 units of new products. The new product’s variable and…

A: Absorption costing: It is one of the managerial accounting methods under which all the costs that…

Q: Plummer Corporation has provided the following data for its two most recent years of operation: $ 44…

A: Absorption costing means that inventory is valued at total manufacturing cost including fixed…

Q: Inventory Valuation under Absorption Costing and Variable Costing At the end of the first year of…

A: Introduction: Absorption costing is a technique for accumulating and assigning production process…

Q: Company A reported the following data for April: sales $692,500 cost of goods sold $305,000 total…

A: Solution: Contribution margin for April = Sales - cost of goods sold - variable selling expense -…

Q: A manufacturing company that produces a single product has provided the following data concerning…

A: Variable cost per unit produced = Direct materials+ Direct labor + Variable manufacturing cost per…

Q: La Lisa uses FIFO for inventory costing: Beginning Inventory 300 units Units Produced 600 Units Sold…

A: The main difference between the absorption costing and variable costing is the treatment of fixed…

Q: Betsy's Pies, Inc. has provided the following financial information for the​ year:   Finished Goods​…

A: There are two methods for the unit product cost. Absorption​ costing: As per this method, Unit…

Q: The level of inventory of a manufactured product has increased by 8,413 units during a period. The…

A: Variable costing is one of the cost allocation methods that is used by a company to allocate costs…

Q: The following table shows the inventory balances, in units, for years 1, 2, and 3. Total fixed…

A: Answer -    Particulars Year 1 2 3         Difference in Operating Income 10800 32000 0…

Q: The following information is available for SAN JOSE CORP.'s new product line: Sale price per unit…

A: The direct costing is similar to variable costing where only direct variable costs are added to…

Q: of the last three years. The units in year 1 beginning inventory were based on production of 500…

A: The variable costing income statement treats fixed manufacturing cost to be expensed during the…

Q: absorption costing

A: The operating income under absorption costing will be lower by the increase in units of inventory…

Q: The following data have been taken from the records of a company: 200,000 Production in units during…

A: Variable Costing - In this costing method, variable costs are considered while preparing the cost of…

Q: Bryans Corporation has provided the following data for its two most recent years of operation: $ 53…

A: Working: Unit Product Costing under Variable Costing: Direct Material $13 Direct Labor $6…

Q: The level of inventory of a manufactured product has increased by 7,809 units during a period. The…

A: Absorption costing  includes all cost ie, Direct cost and indirect cost to get operating income It…

Q: During the previous year, Casually Company had the following data: Units in beginning inventory…

A: 1.  Product cost Per Unit under absorption costing, would be calculated as follows :  Particular…

Q: The following table shows the inventory balances, in units, for years 1, 2, and 3. Total fixed…

A: Fixed cost per unit=Total fixed manufacturing costProduction (Year 2)=$72,000920=$78.260869565

Q: Levy company produces a single product last year the company net operating income computed by the…

A: As per the variable costing method, only variable cost is measured but under absorption costing both…

Q: Dak Mart, a producer of solid oak tables, reports the following data from its second year of…

A: The income statement is prepared to record the revenues and expenses of the current period and…

Q: Given the following: Selling price Units in beginning inventory Units produced Units sold Units in…

A: There are two type of costing method followed by the entities. (1) Variable costing method (2)…

Q: The level of inventory of a manufactured product has increased by 7,827 units during a period. The…

A: Under variable costing system, the fixed expenses are considered as period cost and charged to…

Q: The following table shows the inventory balances, in units, for years 1, 2, and 3. Total fixed…

A: Absorption costing demonstrates that all the expenses related to manufacturing a product are…

Q: At the end of Nabirukan Co.’s first year of operations, 1,000 units of inventory remained on hand.…

A: Answer:   Option A.

Q: On March 31, the end of the first year of operations, Barnard Inc., manufactured 3,200 units and…

A: Cost of goods sold per unit: Formulas;

Q: Farris Corporation, which has only one product, has provided the following data concerning its most…

A: Net operating income (loss) = 11500

Q: Jariable Costing-Production Exceeds Sales Fixed manufacturing costs are $29 per unit, and variable…

A: Production exceeds sales: When production is greater than sales, i.e. ending inventory is greater…

Q: What was the absorption costing net operating income last year?

A: Computation of Net operating income under absorption costing

Q: The following table shows the inventory balances, in units, for years 1, 2, and 3. Total fixed…

A: Fixed manufacturing cost per unit = Total Fixed manufacturing cost  / Total production = $72,000 /…

Q: The following data is for a company that produces a single product. Selling price 193 Units in…

A: Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…

Q: Belle Company reports the following information for the current year. All beginning inventory…

A: In the absorption costing, fixed manufacturing overhead is treated as product cost and allocated to…

Q: The level of inventory of a manufactured product has increased by 8,417 units during a period. The…

A: Under variable costing, the fixed costs are to be treated as full cost incurred but under absorption…

Q: The level of inventory of a manufactured product has increased by 7,534 units during a period. The…

A: Variable costing is a method under which the direct costs are included which varies according to the…

Q: The level of inventory of a manufactured product has increased by 7,848 units during a period. The…

A: In variable income statement all the variable manufacturing expenses are considered as the product…

Q: The level of inventory of a manufactured product has increased by 5,000 units during a period. The…

A: Variable: The cost varies according to the level of units produced.

Q: The following data relate to National Company for the year just ended: P750,000 Sales revenue Cost…

A: There are two type of costing systems which are being used. These are Absorption costing system and…

Q: The level of inventory of a manufactured product has increased by 7,949 units during a period. The…

A: In variable income statement all the variable manufacturing expenses are considered as the product…

Q: Oak Mart, a producer of solid oak tables, reports the following data from its second year of…

A: Under variable costing the unit product cost is sum total of direct material , direct labor and…

Q: Inventory Valuation under Absorption Costing and Variable Costing At the end of the first year of…

A: Absorption costing = this is traditional approach, in this approch all fixed Manufacturing overhead…

Q: units In its first year of operations: direct materials, $14 per unit, direct labor, $10 per unit,…

A: Solution: Under variable costing, product cost per unit includes only variable manufacturing costs…

Q: The contribution format income statement of Goma Corporation follows: Goma Corporation Income…

A: Using absorption costing, the product cost comprises of the variable cost and fixed cost. The net…

Q: The level of inventory of a manufactured product has increased by 7,809 units during a period. The…

A: Absorption costing: Absorption costing is also called traditional costing. This method of costing…

Q: Pacific Inc. has provided the following data for the latest quarter of the most recent year: Sales…

A: The following computations are done for Pacific Incorporation.

Q: The level of inventory of a manufactured product has increased by 8,000 units during a period. The…

A: solution note Dear student as per the Q&A guideline we are required to answer the first question…

Q: Crane Company reports the following operating results for the month of August: sales $392,000 (units…

A: Selling price per unit=$392,000/4,900 = $80 Selling price if increase by 15%=$80*115%=$92 Variable…

Q: Using Direct Costing Method, sha Company had a net profit of ₱76,300. Ending inventory decreased…

A: the given info Not profit = 76300 Ending Inventory decreased from 8oooo units to 78500 units fixed…

Q: Prepare a variable-costing income statement for Pattison Products, Inc., for the month of October.…

A: The variable costs includes direct materials, direct labor, variable overhead, variable selling and…

Q: The Ievel of inventory of a manufactured product has increased by 7,859 units during a period. The…

A: In variable income statement all the variable manufacturing expenses are considered as the product…

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.