Required information [The following information applies to the questions displayed below.] Jorgansen Lighting, Incorporated, manufactures heavy-duty street lighting systems for municipalities. The company uses variable costing for internal management reports and absorption costing for external reports to shareholders, creditors, and the government. The company has provided the following data: Inventories Beginning (units) Year 1 210 150 $ 300,000 Year 2 Year 3 150 190 220 Ending (units) 190 Variable costing net operating income $ 269,000 $ 250,000 The company's fixed manufacturing overhead per unit was constant at $570 for all three years. 2. Assume in Year 4 that the company's variable costing net operating income was $260,000 and its absorption costing net operating income was $290,000. a. Did inventories increase or decrease during Year 4? b. How much fixed manufacturing overhead cost was deferred or released from inventory during Year 4?
Required information [The following information applies to the questions displayed below.] Jorgansen Lighting, Incorporated, manufactures heavy-duty street lighting systems for municipalities. The company uses variable costing for internal management reports and absorption costing for external reports to shareholders, creditors, and the government. The company has provided the following data: Inventories Beginning (units) Year 1 210 150 $ 300,000 Year 2 Year 3 150 190 220 Ending (units) 190 Variable costing net operating income $ 269,000 $ 250,000 The company's fixed manufacturing overhead per unit was constant at $570 for all three years. 2. Assume in Year 4 that the company's variable costing net operating income was $260,000 and its absorption costing net operating income was $290,000. a. Did inventories increase or decrease during Year 4? b. How much fixed manufacturing overhead cost was deferred or released from inventory during Year 4?
Chapter2: Building Blocks Of Managerial Accounting
Section: Chapter Questions
Problem 4EB: Roper Furniture manufactures office furniture and tracks cost data across their process. The...
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Please help me with part a and b thanku
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