Really having a hard time with Absorption and the Throughput method, any help would b appreciated.

Asian Iron began last year with no inventories. During the year, 10,500 units were produced, of which 9,400 were sold. Data concerning last year's operations appear here (in New Taiwanese dollars, NT$):

	Revenue	NT$32,900
	Variable direct materials cost	2,300
	Variable direct labor costs	3,300
	Variable manufacturing overhead	2,800
	Variable selling	940
	Fixed manufacturing overhead	8,250
	Fixed selling and administrative costs	14,560

Variable manufacturing costs reflect the variable cost to produce the number of units manufactured. However, variable selling costs are not incurred until the units are sold, so they reflect the cost for the number of units sold. Asian Iron allocates actual manufacturing overhead costs to inventory based on actual units produced.


Calculate the value of ending inventory on the balance sheet under the following: (Round answers to 0 decimal places.)

1. Variable costing
2. Absorption costing
3. Throughput costing

Calculate operating income under each of the following methods: (Round answers to 0 decimal places.)

1. Variable costing
2. Absorption costing
3. Throughput costing

Estimate the variable costing operating income if 12,110 units were produced and sold in a year

What do YOU think ?
While we're happy to HELP we wont do all the work for you.
Show us what you have done and where you are having problems..

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Originally Posted by Curlyben

What do YOU think ?
While we're happy to HELP we wont do all the work for you.
Show us what you have done and where you are having problems..

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I have done the variable for operating income's and ending inventory. I am just not understanding how to calculate the absorption and throughput method of finding ending inventory and operating income.

you need to do additional reading on these methdologies so you understand what they are attempting to achieve