Prepare operating income statement by both, absorption and direct costing approach.
Prepare operating income statement by both, absorption and direct costing approach.
Accounting
27th Edition
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Chapter21: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 21.28EX: Appendix Absorption costing income statement On June 30, the end of the first month of operations,...
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Question
Q # 7
Kabeer Manufacturing Co. uses direct costing. Following information have been received from their accounting records for a single product at the end of the year:
Planned Production in units |
30,000 |
Actual Production in units |
29,000 |
Actual sales in units |
28,000 |
|
Fixed Costs (Rs.) |
Variable Costs (Rs.) |
Raw Materials |
|
52 |
Direct Labor |
|
40 |
FOH |
|
28 |
Fixed FOH - Cost |
Rs. 160,000 |
|
Marketing and Administrative Costing |
Rs. 100,000 |
Rs. 9 per unit sold |
Note: Selling price of each single unit is Rs. 200.
Required
Prepare operating income statement by both, absorption and direct costing approach.
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