Variable Costing Managers frequently use variable costing for internal purposes for taking decision making. The cost of goods manufactured includes direct materials, direct labor, and variable factory overhead . Fixed factory overhead treated as period (fixed) expense. To Explain: The reason why the service companies use different activity bases than manufacturing companies to classify fixed and variable costs.

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Answer 1

Question

Chapter 20, Problem 20.11EX

To determine

Variable Costing

Managers frequently use variable costing for internal purposes for taking decision making. The cost of goods manufactured includes direct materials, direct labor, and variable factory overhead. Fixed factory overhead treated as period (fixed) expense.

To Explain: The reason why the service companies use different activity bases than manufacturing companies to classify fixed and variable costs.

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Answer 2

Question

Chapter 20, Problem 20.11EX

To determine

Variable Costing

Managers frequently use variable costing for internal purposes for taking decision making. The cost of goods manufactured includes direct materials, direct labor, and variable factory overhead. Fixed factory overhead treated as period (fixed) expense.

To Explain: The reason why the service companies use different activity bases than manufacturing companies to classify fixed and variable costs.

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Answer 3

Question

Chapter 20, Problem 20.11EX

To determine

Variable Costing

Managers frequently use variable costing for internal purposes for taking decision making. The cost of goods manufactured includes direct materials, direct labor, and variable factory overhead. Fixed factory overhead treated as period (fixed) expense.

To Explain: The reason why the service companies use different activity bases than manufacturing companies to classify fixed and variable costs.

Expert Solution & Answer

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Answer 4

Question

Chapter 20, Problem 20.11EX

To determine

Variable Costing

Managers frequently use variable costing for internal purposes for taking decision making. The cost of goods manufactured includes direct materials, direct labor, and variable factory overhead. Fixed factory overhead treated as period (fixed) expense.

To Explain: The reason why the service companies use different activity bases than manufacturing companies to classify fixed and variable costs.

Expert Solution & Answer

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Answer 5

Chapter 20, Problem 20.11EX

To determine

Variable Costing

Managers frequently use variable costing for internal purposes for taking decision making. The cost of goods manufactured includes direct materials, direct labor, and variable factory overhead. Fixed factory overhead treated as period (fixed) expense.

To Explain: The reason why the service companies use different activity bases than manufacturing companies to classify fixed and variable costs.

Answer 6

Chapter 20, Problem 20.11EX

To determine

Variable Costing

Managers frequently use variable costing for internal purposes for taking decision making. The cost of goods manufactured includes direct materials, direct labor, and variable factory overhead. Fixed factory overhead treated as period (fixed) expense.

To Explain: The reason why the service companies use different activity bases than manufacturing companies to classify fixed and variable costs.

Answer 7

Chapter 20, Problem 20.11EX

To determine

Variable Costing

Managers frequently use variable costing for internal purposes for taking decision making. The cost of goods manufactured includes direct materials, direct labor, and variable factory overhead. Fixed factory overhead treated as period (fixed) expense.

To Explain: The reason why the service companies use different activity bases than manufacturing companies to classify fixed and variable costs.

Answer 8

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Answer 9

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Answer 11

Ch. 20 - What types of costs are customarily included in...Ch. 20 - Which type of manufacturing cost (direct...Ch. 20 - Which of the following costs would be included in...Ch. 20 - In the variable costing income statement, how are...Ch. 20 - Since all costs of operating a business are...Ch. 20 - Discuss how financial data prepared on the basis...Ch. 20 - Why might management analyze product...Ch. 20 - Explain why rewarding sales personnel on the basis...Ch. 20 - Discuss the two factors affecting both sales and...Ch. 20 - How is the quantity factor for an increase or a...

Solution Summary: The author explains how variable and fixed costs are categorized according to how the costs vary relative to an activity base.

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