ZB Toys started 2017 with no inventories. During the year, their expected and actual production was 30,000

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ZB Toys started 2017 with no inventories. During the year, their expected and actual production was 30,000 units, of which they sold 24,000 units at $50 each. Cost data for the year is as follows:

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Calculate ZB Toys’ operating income under

(a) variable costing, and

(b) absorption costing.
Explain why operating income differs under the two approaches.

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Horngrens Cost Accounting

ISBN: 978-1292211671

16th Edition

Authors: Srikant Datar, Madhav Rajan

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Question Posted: Apr 12, 2024 11:01 PM

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ZB Toys started 2017 with no inventories. During the year, their expected and actual production was 30,000

Question:

Manufacturing costs incurred: Variable Fixed Marketing costs incurred: Variable Fixed $525,000 $372,000 $144,800 $ 77,400

Step by Step Answer:

Horngrens Cost Accounting

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