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among various concepts of capacity for calculating the cost of each unit produced. unfavorable ( U ) . ) table [ [ , Theoretical,Practical
among various concepts of capacity for calculating the cost of each unit produced. unfavorable U tableTheoretical,PracticalRevenue$Less: Cost of Goods Sold,,ProductionVolume Variance,,UGross Margin,,Variable Selling,,Fixed Selling,,Operating Income,$ Data table tableTheoretical capacity, bulbsPractical capacity, bulbsNormal capacity, bulbs average expected output for the next three yearsMasterbudget capacity, bulbs expected production this year Requirements If sells all bulbs produced, what would be the effect on operating income of using each type of capacity as a basis for calculating manufacturing cost per unit? Compare the results of operating income at different capacity levels when bulbs are sold and when bulbs are sold. What conclusion can you draw from the comparison? Using the original data that is units produced and units sold if GBL had used the proration approach to allocate the productionvolume variance, what would operating income have been under each level of capacity? Assume that there is no ending work in process. Reference tabletableTheoreticalcapacitytablePracticalcapacitytableNormalcapacitytableasterbudgetcapacityInventoriable cost per unit,$$$$Production volume variance foractual production of bulbs,$$$$
among various concepts of capacity for calculating the cost of each unit produced. unfavorable U
tableTheoretical,PracticalRevenue$Less: Cost of Goods Sold,,ProductionVolume Variance,,UGross Margin,,Variable Selling,,Fixed Selling,,Operating Income,$
Data table
tableTheoretical capacity, bulbsPractical capacity, bulbsNormal capacity, bulbs average expected output for the next three yearsMasterbudget capacity, bulbs expected production this year
Requirements
If sells all bulbs produced, what would be the effect on operating income of using each type of capacity as a basis for calculating manufacturing cost per unit?
Compare the results of operating income at different capacity levels when bulbs are sold and when bulbs are sold. What conclusion can you draw from the comparison?
Using the original data that is units produced and units sold if GBL had used the proration approach to allocate the productionvolume variance, what would operating income have been under each level of capacity? Assume that there is no ending work in process.
Reference
tabletableTheoreticalcapacitytablePracticalcapacitytableNormalcapacitytableasterbudgetcapacityInventoriable cost per unit,$$$$Production volume variance foractual production of bulbs,$$$$
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