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Alderman Company uses standard costing. Tim Monette, the new presidont of Alderman Company, is presented with the following data for 2020 : IZB (Click the
Alderman Company uses standard costing. Tim Monette, the new presidont of Alderman Company, is presented with the following data for 2020 : IZB (Click the icon to view the data.) Read the requirements. Data table Requirements 1. At what percentage of denominator level was the plant operating during 2020 ? 2. How much fixed manufacturing overhead was included in the 2019 and the 2020 ending inventory under absorption costing? 3. Reconcle and explain the difference in 2020 operating incomes under variable and absorption costing. 4. Tim Monette is concemed: He notes that despite an increase in sales over 2019, 2020 operating income has actually declined under absorption costing. Explain how this occurred. 2. Alderman Company uses standard costing. Tim Monette, the new president of Alderman Company, is presented with the following data for 2020 : '(Click the icon to view the data.) Read the requirments? 2, Requirement 1. At what peroentage of denominator level was the plant operating during 2020 ? Determine the fomula, then compute at what percentage of denominator level the plant was operating during 2020. (Abbreviation used: "mig" = manufacturing.) (1) - % ol denominator level = Requirement 2. How much fxed manufacturing overhead was included in the 2019 and the 2020 ending linventory under absorption costing? Requirement 3. Reconcie and explain the differance in 2020 operating incomes under variable and absorption costing. ending-) The difference between ahsorption and variable costing is due solely to moving 0 . when the inventories were in 2020. Under absorption costing, operating income is a function of (9) During 2020, Alderman experienced a (10) in inventory levels as a result of 111 The end result was that much of
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