Variable Costing—Sales Exceed Production The beginning inventory is 14,000 units. All of the units that were manufactured during the period and 14,000 units of the beginning inventory were sold. The beginning inventory fixed manufacturing costs are $64 per unit, and variable manufacturing costs are $118 per unit. a.  Determine whether variable costing operating income is less than or greater than absorption costing operating income.   b.  Determine the difference in variable costing and absorption costing operating income

a) A company manufactures a single product. Unit costs are:                      $/Unit Variable production cost             14.75 Fixed production                     8.30 Variable selling                       2.60 Fixed selling                         5.45   400,000 units of the product were manufactured in a period, during which 394,000 units were sold. There was no inventory of the product at the beginning of the period. Required: 1) Use Marginal costing to calculate the total value of the finished goods inventory at the end of the period. 2) Many firms have decided to use marginal costing to prepare the income statement. Please briefly explain the benefits of using marginal costing.                                                                                    b) Newcastle Ltd manufactures and sells T-shirts imprinted with college names and slogans. Last Year, the shirts sold for £7.50 each, and the variable cost was £2.25 per shirt. The company needed to…

Hayes Incorporated provided the following information for the current year: Beginning inventory Units produced Units sold Selling price Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling/administrative costs Fixed selling/administrative costs What is the product cost per unit for the year using variable costing? Multiple Choice $162 $114 $138 260 units 910 units 960 units $ 310/unit $ 51/unit $ 32/unit $ 31/unit $ 43,680/year $ 24/unit $ 31,500/year

The following information is available for Barnes Company for the fiscal year ended December 31: Beginning finished goods inventory in units Units produced Units sold Sales 0 8,600 5,900 $ 767,000 $ 172,000 $ 86,000 Materials cost Variable conversion cost used Fixed manufacturing cost Indirect operating costs (fixed) $ 946,000 $ 118,000 The difference between the variable costing ending inventory and the absorption costing ending inventory is: Multiple Choice O 2,700 units times $115 per unit variable conversion cost plus $110 per unit fixed manufacturing cost 4 2,700 units times $115 per unit variable conversion cost plus $110 per unit fixed manufacturing cost plus $111.67 per unit indirect operating c 2,700 units times $105 per unit materials cost