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Absorption Statement to Variable Costing Stmt The Absorption Statements above have been adjusted for any product price changes and depreciation changes from Quarter 1 through
Absorption Statement to Variable Costing Stmt The Absorption Statements above have been adjusted for any product price changes and depreciation changes from Quarter 1 through the end of Quarter 2 . Using the Degree of Operational Leverage (DOL) re-state each quarter into a Variable Costing Statement. Reference: \% Change in Sales XDOL=% Change in Op income. DOL for Quarter #1 must equal = Since DOL=CM/Op Income, then Quarter \#1 CM must be = With this information, format Quarter \#1 into a variable costing statement below. Quarter \#1 Variable Costing Statement Use the Contribution Margin Ratio of Quarter \#1 to format a Variable Costing Statement for Quarter H2. Quarter \#2 Variable Costing Statement (Hint: Fixed Cost should be the same for both Quarters)
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