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    jnewcome's Avatar
    jnewcome Posts: 3, Reputation: 1
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    #1

    Jul 24, 2011, 02:08 PM
    Variable and Absorption costing
    Consider the following data:

    Sales: 12,000 units at $17 each
    Actual Production: 15,000 units
    Expected volume of production: 18,000 units
    Manufacturing costs incurred
    Variable: $120,000
    Fixed: 63,000
    Nonmanufacturing costs incurred
    Variable: $24,000
    Fixed: 18,000

    1) Determine operating income, assuming the firm uses the variable-costing approach to product costing.

    2) Assume that there is no January 1, 20X7 inventory; no variances are allocated to inventory; and the firm uses a “full absorption” approach to product costing. Compute a) the cost assigned to December 31, 20X7 inventory and b) operating income for the year ended December 31, 20X7.
    JudyKayTee's Avatar
    JudyKayTee Posts: 46,503, Reputation: 4600
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    #2

    Jul 24, 2011, 02:30 PM

    We don't do homework. Usually people are more resourceful and don't copy the assignment word for word.
    jnewcome's Avatar
    jnewcome Posts: 3, Reputation: 1
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    #3

    Jul 24, 2011, 02:39 PM
    Comment on JudyKayTee's post
    Ok, thank you, was hoping that I could get help undrstanding it better since my teacher is no help and the text is a little confusing. My mistake!
    JudyKayTee's Avatar
    JudyKayTee Posts: 46,503, Reputation: 4600
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    #4

    Jul 24, 2011, 02:43 PM

    Post what you THINK the answer is and someone will come along and help you. It's the "start from the beginning to ending" that "usually" doesn't happen.
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