Variable and Absorption Costing Chandler Company sells its product for $107 per unit. Variable manufacturing costs per unit are $48, and fixed manufacturing costs at the normal operating level of 12,000 units are $240,000. Variable selling expenses are $19 per unit sold. Fixed administrative expenses total $104,000. Chandler had no beginning inventory in 2016. During 2016, the company produced 12,000 units and sold 9,000. Would net income for Chandler Company in 2016 be higher if calculated using variable costing or using absorption costing? Calculate reported income using each method. Do not use negative signs with any answers. Absorption Costing Income Statement Sales Answer Cost of Goods Sold: Beginning Inventory Answer Variable Costs Answer Fixed Costs Answer Less: Ending Inventory Answer Cost of Goods Sold Answer Answer Answer Answer Answer Administrative expense Answer Net Income Answer Variable Costing Income Statement Sales Answer Cost of Goods Sold: Beginning Inventory Answer Variable Costs Answer Answer Answer Variable cost of goods sold Answer Answer Answer Answer Answer Fixed costs: Answer Answer Administrative Expense Answer Total Fixed Cost Answer Net Income Answer
Variable and Absorption Costing Chandler Company sells its product for $107 per unit. Variable manufacturing costs per unit are $48, and fixed manufacturing costs at the normal operating level of 12,000 units are $240,000. Variable selling expenses are $19 per unit sold. Fixed administrative expenses total $104,000. Chandler had no beginning inventory in 2016. During 2016, the company produced 12,000 units and sold 9,000. Would net income for Chandler Company in 2016 be higher if calculated using variable costing or using absorption costing? Calculate reported income using each method. Do not use negative signs with any answers. Absorption Costing Income Statement Sales Answer Cost of Goods Sold: Beginning Inventory Answer Variable Costs Answer Fixed Costs Answer Less: Ending Inventory Answer Cost of Goods Sold Answer Answer Answer Answer Answer Administrative expense Answer Net Income Answer Variable Costing Income Statement Sales Answer Cost of Goods Sold: Beginning Inventory Answer Variable Costs Answer Answer Answer Variable cost of goods sold Answer Answer Answer Answer Answer Fixed costs: Answer Answer Administrative Expense Answer Total Fixed Cost Answer Net Income Answer
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter7: Variable Costing For Management
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Section: Chapter Questions
Problem 8E: Estimated income statements, using absorption and variable costing Prior to the first month of...
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Variable and Absorption Costing
Chandler Company sells its product for $107 per unit. Variable
Calculate reported income using each method.
Do not use negative signs with any answers.
Absorption Costing Income Statement | ||||
---|---|---|---|---|
Sales | Answer | |||
Cost of Goods Sold: | ||||
Beginning Inventory | Answer | |||
Variable Costs | Answer | |||
Fixed Costs | Answer | |||
Less: Ending Inventory | Answer | |||
Cost of Goods Sold | Answer | |||
Answer | Answer | |||
Answer | Answer | |||
Administrative expense | Answer | |||
Net Income | Answer |
Variable Costing Income Statement | ||||
---|---|---|---|---|
Sales | Answer | |||
Cost of Goods Sold: | ||||
Beginning Inventory | Answer | |||
Variable Costs | Answer | |||
Answer | Answer | |||
Variable cost of goods sold | Answer | |||
Answer | Answer | |||
Answer | Answer | |||
Fixed costs: | ||||
Answer | Answer | |||
Administrative Expense | Answer | |||
Total Fixed Cost | Answer | |||
Net Income | Answer |
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