Question
Please ineed help solving the following exercise. Bianca Bicycle Company manufactures mountain bikes with a variable cost of $200. The bicycles sell for $350 each.
Please ineed help solving the following exercise.
Bianca Bicycle Company manufactures mountain bikes with a variable cost of $200. The bicycles sell for $350 each. Budgeted fixed manufacturing overhead for the most recent year was $2,200,000. Planned and actual production for the year were the same. Required: Under each of the following conditions, state ( a ) whether income is higher under variable or absorption costing and ( b ) the amount of the difference in reported income under the two methods. Treat each condition as an independent case.
1. Production ........................................... 20,000 units Sales ................................................... 23,000 units 2. Production ........................................... 10,000 units Sales ................................................... 10,000 units 3. Production ........................................... 11,000 units Sales ................................................... 9,000 units
Thankyou in advance
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