variable costing
Q: Considering the data given above, under variable costing and absorption costing, ending inventory…
A: Income statement: The income statement determines the net income of the business by subtracting the…
Q: Which of the following is NOT true of variable costing? a. Profits may increase though sales…
A: Variable costing is a concept used in managerial and cost accounting in which the fixed…
Q: Kertas, Inc. produces paper and office supplies and uses the just-in-time inventory system.…
A: Just in time inventory system is the system where the Purchase is done only when it is required , so…
Q: Which of the following is true of a company that uses absorption costing? Multiple Choice Net…
A: Absorption costing: Under the absorption costing method, manufacturing costs such as direct material…
Q: Identify if true or false When inventory decreases, the net operating income under absorption…
A: Costing is a process under which the information about the costs incurred by the business unit is…
Q: It’s common in the electronics industry for unit costs of raw materials inventories to decline over…
A: LIFO: Under this inventory method, the units that are purchased last, are sold first. Thus, it…
Q: Which of the following statements is false ? a. Volume-based costing has typically resulted in…
A: There are two methods of costing that are in place generally. One is volume based costing and other…
Q: When inventories are decreasing, _________ costing will lead to lower profits because…
A: When inventories are decreasing, absorption costing will lead to lower profits because capitalized…
Q: 1: When using absorption costing, a company may be able to show a profit even if it is operating…
A: Solution: True, When using absorption costing, a company may be able to show a profit even if it is…
Q: When the number of units sold exceed the number of units produced, income reported under absorption…
A: Fixed overhead costs include those costs which shall not vary with the production output. In…
Q: Why is variable costing not in compliance with generally accepted accounting principles? a. Fixed…
A: The generally accepted accounting principles are following the absorption method for the valuation…
Q: Under variable costing, which of the following costs are assigned to inventory? Variable Selling &…
A: “Since you have asked multiple question, we will solve the first question for you. If you want any…
Q: Which of the following would most likely decrease the product cost per unit under variable costing?…
A: Under variable costing, product cost per unit will comprise of direct material cost , direct labour…
Q: ?Which of the following statements is false Activity-based costing typically provides less…
A: In order to solve in this question, we need to analyse the given statement one-by-one.
Q: All these statements are true for Marginal costing except this O Costs are segregated based on…
A: Marginal costing refers to the costing approach in which, variable costs are considered as the…
Q: Why do you think a company would ever choose to use perpetual LIFO as its costing method? It is…
A: Note: Since you have posted multiple questions, we will solve the first question. Please submit a…
Q: When units sold exceeds units produced the relationship between net income under absorption costing…
A: THE VARIABLE COSTING METHOD TREATS FIXED MANUFACTURING OVERHEAD COSTS AS PERIOD COSTS , ALL FIXED…
Q: When comparing absorption costing with variable costing, which of the following statements is not…
A: Absorption costing is that method of costing, in which all total costs (fixed and variable) are…
Q: Which of the following statement is false? Multiple Choice a)The contribution margin…
A: Ans. Absorption costing allocates fixed manufacturing overhead to a product whether or not it is…
Q: When company reduced its inventories to zero, then a) Variable costing income > Absorption costing…
A: The difference between absorption costing income and variable costing income arises due to the…
Q: Under variable costing a. Net income will tend to vary inversely with production changes b. Net…
A: DM=Direct materials OHD=Overhead Step 1 Variable costing is a method that only allocates…
Q: Two companies have identical fixed expenses, unit variable expenses, and profits. Yet one company…
A:
Q: variable costing
A: What will be the difference in net earnings computed using variable costing as opposed toabsorption…
Q: The table represents the breakdown of cost structure, which is constructed based on the information…
A: It has been seen from the table that the markdown of Zara is lower i.e.2.6 as compared to their…
Q: Which of the following is true regarding the contribution margin ratio of a company that produces…
A: Contribution margin ratio =Contribution per unitSales price per unit Contribution per unit = Sales…
Q: Product costs under variable costing are typically: Group of answer choices A. higher than under…
A:
Q: Variable selling expenses are a. Product costs under variable costing but period costs under…
A: Hi student Since there are multiple questions, we will answer only first question.
Q: True or False Product cost under Variable costing are DM, DL and VOH only. Under absorption…
A: Solution:- Discussions of above statements as follows under:-
Q: Inventory values calculated using variable costing as opposed to absorption costing will generally…
A: Inventory is referred to as current asset which includes raw materials, work in process inventory…
Q: What will be the difference in net earnings computed using variable costing as opposed to absorption…
A: Under variable costing, whole amount of fixed overhead will be charged in the income statement.…
Q: costs assigned to units in inventory are typically lower under absorption costing than under vanable…
A: As per the guidelines, only one question is allowed to be solved so I am answering the first…
Q: A manufacturer is considering eliminating a segment because it shows the following $6,100 loss. All…
A: Lets understand the basics. When there is choice of whether eliminating any product line then there…
Q: Which of the following statements is not true regarding the use of variable and absorption costing…
A: Answer: Option d.
Q: 7. Under variable costing, which of the following costs are assigned to inventory? Variable Selling…
A: Hi Student Since there are multiple questions we will answer only first question. If you want…
Q: Which of the following statements is true for a company that uses variable costing? Profit…
A: Profit fluctuates with sales Profit increases with increases in sales and vice versa. Product…
Q: 1. Which of the following assumptions is false in a cost-volume-profit analysis? Total sales and…
A: Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: In comparing the absorption and variable cost methods, each of the following statements is true…
A: Variable Costing:The variable costing is a method used to allocate the fixed manufacturing overhead…
Q: This best accounts for the difference in profit between the absorption and variable costing *…
A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…
Q: Identify if true or false 1. If the ending inventories happened to be zero, the net profit reported…
A: “Since you have posted a question with multiple sub-parts, we will solve first three subparts for…
Q: 1. The value of Bruno's actual ending finished goods inventory on the absorption costing basis was…
A: Working Notes :-…
Q: a. Based on the data given, prepare a variable costing income statement for Bluth, assuming that the…
A:
Q: T, F. In a make or buy short-run decision situation, the critical element to consider is whether the…
A: Variable cost is that cost that varies with the number of units produced. It means that increase in…
Q: Operating profits move in the same direction as sales when variable costing is used if selling…
A: Introduction:- Variable costing varies in respective of units production Which is used for making…
Q: Variable costing has an advantage over absorption costing for which of the following purposes? all…
A: Under variable costing, the product cost consists of the variable cost incurred and total fixed cost…
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- When the number of units in ending inventory increases through the year, which of the following is true? A. Net income is the same for variable and absorption costing. B. Net income is higher for variable costing than for absorption costing. C. Net income is higher for absorption costing than for variable costing. D. There is no relationship between net Income and the costing method.Product costs under variable costing are typically: A. higher than under absorption costing B. lower than under absorption costing C. the same as with absorption costing D. higher than absorption costing when inventory increasesWhen prices are falling (deflation), which costing method would produce the highest gross margin for the following? Choose first-in, first-out (FIFO); last-in, first-out (LIFO); or weighted average, assuming that B62 Company had the following transactions for the month. Calculate the gross margin for each of the following cost allocation methods, assuming B62 sold just one unit of these goods for $400. Provide your calculations. A. first-in, first-out (FIFO) B. last-in, first-out (LIFO) C. weighted average (AVG)
- Which of the following is NOT true regarding an income statement organized according to thecontribution margin approach? Question 6 options: The contribution margin income statement is organized by cost behavior. Operating income will always be the same as operating income in a traditional income statement regardless of changes in inventory levels. All fixed costs, including fixed MOH, are expensed below the contribution margin line. The contribution margin is equal to sales revenue minus variable expenses.What will be the difference in net earnings computed using variable costing as opposed toabsorption costing if the ending inventory increases with respect to the beginning inventories interms of units?a. There will be no difference in net earnings.b. Net earnings computed using variable costing will be higher.c. The difference in net earnings cannot be determined from the information given note.d. Net earnings computed using variable costing will be lowerUnder variable costing, which of the following costs are assigned to inventory? Variable Selling & Administrative Costs variable Factory Overhead Costs (A) Yes No b)No yes c)Yes Yes d) No No 8.Which of the following would appear on both the budgeted income statement and on the schedule of expected cash disbursements for operating expenses? (A) Depreciation expense (B) Rent expense (C) Sales commission expense (D) Both B and C 9.Which of the following is not an underlying assumption of the cost-volume-profit graph? (A) Expenses are categorized into fixed and variable (B) Revenues and expenses are linear over the relevant range (C) Efficiency and productivity will be unchanged (D) Sales mix will not be…
- Choose the letter of the correct answer: 1.) This best accounts for the difference in profit between the absorption and variable costing * a.) Difference in sales revenue b.) Difference in fixed costs incurred c.) Difference in inventory valuation d.) Difference in variable costs incurred 2.) Variable selling expenses are * a.) Product costs under variable costing but period costs under absorptions costing b.) Period costs under variable costing but product cost under absorption costing c.) Product costs under both costing methods d.) period costs under both costing methods 3. Which of the following types of cost do not appear on a variable costing income statement? * a.) Direct labor b.) Direct materials c.) Variable selling expenses d.)Fixed factory overhead per unit per sold 4.) All of the following costs are included as product costs under absorption costing except *…Which of the following statement is correct? A In a variable costing income statement, sales revenue is typically higher than in absorption costing income statement. B When production is not equal to sales, income under absorption costing differs from income under variable costing due to the difference in treatment ( product cost and period cost) of the fixed overhead cost under the two costing methods. C In variable costing system, fixed overhead cost is included as part of the cost of inventory. D In an absorption costing system, fixed overhead cost is treated as a period cost.First: When reconciling variable costing and absorption costing net operating income, fixed manufacturing overhead costs deferred in inventory under absorption costing should be deducted from variable costing net operating income to arrive at the absorption costing net operating income. Second: Under absorption costing, a portion of fixed manufacturing overhead cost is released from inventory when sales volume exceeds production volume. * a. Both statements are true b. Only the first statement is true c. Only the second statement is true d. Both statements are false
- The costs assigned to units in inventory are typically lower under absorption costing thanunder vanable costinaTRUEFALSE Operating profits move in the same direction as sales when variable costing is used ifselling prices, the sales mix and the cost structure remain the sameTRUEFALSE Absorption costing is more compatible with cost-volume-profit analysis than is variablecosting.TRUEFALSE Variable manufacturing overhead costs are treated as period costs under bothabsorption and variable costingTRUEFALSE Operating profit is affected by changes in production under both the variable costing andabsorption costing approachesTRUEFALSE In a manufacturing company using absorption costing, the fixed costs associated withidle production capacity are commonly included as part of the product cost.TRUEFALSE In activity-based costing, some manufacturing costs may be excluded from product costsTRUEFALSE The margin of safety can be defined as the amount by which sales can decrease beforelosses are…7. Under variable costing, which of the following costs are assigned to inventory? Variable Selling & Administrative Costs Variable Factory Overhead Costs (A) Yes No (B) No Yes (C) Yes Yes (D) No No 8. Which of the following would appear on both the budgeted income statement and on the schedule of expected cash disbursements for operating expenses? (A) Depreciation expense (B) Rent expense (C) Sales commission expense (D) Both B and C 9. Which of the following is not an underlying assumption of the cost-volume-profit graph? (A) Expenses are categorized into fixed and variable (B) Revenues and expenses are linear over the relevant range (C) Efficiency and productivity will be unchanged (D) Sales mix will not be constantFirst: The inventory value shown on the balance sheet is generally higher under absorption costing than under variable costing. Second: Under variable costing, inventoriable product costs consist of direct materials, direct labor, variable manufacturing overhead and variable selling and administration expenses. * a. Both statements are true b. Only the first statement is true c. Only the second statement is true d. Both statements are false
