View Full Version : Determine operating income using variable-costing approach
Twatlington
Jul 18, 2009, 08:19 PM
How can I Determine the operating income using variable-costing approach.
Example:
Sales: 26,000 units at $17 each
Actual production 30,000 units
Expected volume of production 33,000 units
Manufacturing costs incurred
Variable $220,000
Fixed 93,000
Non manufacturing costs incurred
Variable $ 88,000
Fixed 42,000
Anything will help Thanks
:p
The_Egyptian
Oct 13, 2009, 03:15 AM
Sales 442,000.00
(17.00$*26,000units)
minusVariable manufacturing costs for sold Qty 190,666.67
(220,000$/30,000units*26,000units)
minusVariable non manufacturing costs for sold Qty 76,266.67
(88,000$/30,000units*26,000units)
Contribution margin 175,066.67
minusFixed manufacturing costs 93,000.00
minusFixed non manufacturing costs 42,000.00
Operating Income 40,066.67
there is an excel sheet attached for revision
The_Egyptian
Oct 13, 2009, 03:18 AM
Sorry I forgot the attachment
morgaine300
Oct 14, 2009, 10:09 PM
The_Egyptian, at this site we are not here to just provide solutions to people's homework problem, but rather to help them understand how to do it for themselves.
Please see the guidelines on posting homework:
https://www.askmehelpdesk.com/finance-accounting/announcement-font-color-ff0000-u-b-read-first-expectations-homework-help-board-b-u-font.html
The_Egyptian
Oct 18, 2009, 01:01 AM
The_Egyptian, at this site we are not here to just provide solutions to people's homework problem, but rather to help them understand how to do it for themselves.
Please see the guidelines on posting homework:
Ask Me Help Desk - Announcements in Forum : Homework Help (https://www.askmehelpdesk.com/finance-accounting/announcement-font-color-ff0000-u-b-read-first-expectations-homework-help-board-b-u-font.html)
Thanks for your note, and sorry for the misunderstand.
But the solution I wrote is for discussion, I'm not sure if it's 100 % right.