Printem Mastery Problem: Variable Costing for Management Analysis Absorption vs. Variablo Method Comparison Absorption Statement Variable Statoment Manufacturing Decisions Shaded cells have feedback 1. Use the income statements on the Absorption Statement and Variable Statement panels to complete the following table for the original production level. Then prepare similar income statements at a production level 10,000 units higher and add that information to the table. Assume that total fixed costs, unt variable costs, unit sales price, and the sales levels are the same at both production levels Original Production Level-Absorption Income From Operations Original Additional Production 10,000 Level-Variable Units-Absorption Additional 10,000 Units-Variable $ $ $ Points 074 Feedback Check My Work Following the examples on the Absorption Statement and Variable Statement panels, recompute income from operations under the absorption and variable cost methods. given that the additional units are manufactured. Don't forget that fed costs will remain the same at any production level within the relevant range. 2 What is the change in income from operations from producing 10,000 additional units under absorption conting? Points: 0/1 Next Check My Work All work saved Email Instructor Save and Exit Submit Assignment for Grading Update w.commissionel Mondo vokietakeAssignmentsession.octor in progressatabe Homewo Entrem Mastery Problem: Variable Costing for Management Analysis Absorption vs. Variable Method Comparison Absorption Statement Variable Statement Shaded colonave feedback Manufacturing Decisions 3. What is the change in income from operations from producing 10.000 additional units under variable costing? Points 011 Feedback Check My Work Review your chart and determine the change in income from operations, focusing only on the change ip variable costing amounts. 4. What would be your recommendation to the production manager? Do not produce the extra 10,000 units. The increase in income from operations under absorption costing is due to faced manufacturing costs being held in inventory, and the additional inventory will lead to higher handling, storage, financing, and obsolescence costs. O Produce the extra 10,000 units. Income from operations will be increased, and the production manager will receive praise for creating higher profits. O Produce the extra 10,000 units. It's always a good idea to have extra units on hand and keep the factory operating at capacity, even if all the units are not sold. O Do not produce the extra 10,000 units. Income from operatione does not change under absorption costing when the additional units are produced Points 1/1 Next > Check My Work All work saved. Email Instructor Save and Exde Submit Assignment for Grading Mastery Problemi Variable Costing for Management Analysis Absorption vs. Variable Method Comparison Absorption istement Variable statement Shaded Manufacturing Decisions Absorption Statement 3. Abortion cong coes not gunstween Variantiems. Ar manicuring cows are included in our or gooon 671 Sion, Inc Absorption Costing Income Statement For the Your Ended December 31 Sales $1,200,000.00 SODO 800,000.00 + ind (700.000.00) 1 Cost of goods sold Beginning inventory Cost of goods manufactured Ending Inventory Total cost of goods sold Gross profit Selling and administrative pemes Income from operations 600,000.00 $600,000.00 275,000.00 $325.000.00 1/1 Check My Work Email Instructor Save and Exit Sub Assignment All work saved Cer 20 Homewo Printem Mastery Problemi Variable Costing for Management Analysis TAL Absorption vs. Variable Method Comparison Absorption St Varatten Shaded call rave toedink Manufacturing Decisions Absorption Statement Variable Statement Variable Costing Income Statement For the Year Ended December 31 $1,200,000.00 Sales 1 Variable cost of goods sold 1 $0.00 Beginning inventory Variable cost of goods manufactured 560,000.00 (140,000.00 Ending inventary Total variable cost of goods sold . 420,000.00 Manufacturing margin Variable selling and administrative expenses $780,000.00 210,000.00 Contribution margin $570,000.00 10 Fixed costs 11 Fixed manufacturing costs 1 Fixed selling and administrative expenses $240,000.00 65,000.00 13 Total fixed costs 305,000.00 Income from operations $265.000.00 Check My Work All work saved Email Instructor Save and Exit Submit Assignment Print Item Mastery Problem: Variable Costing for Management Analysis Absorption vs. Variable Method Comparison Absorption Statement Variable Statement Absorption vs. Variable Method Comparison Shaded cells have Shaded calls have Review the income statements on the Absorption Statement and Variable Statement panels, then complete the following table. The company's sales price per unit is $80 cm number of units in ending inventory is 5,000. Item Amount 15,000 Number of units sold Variable sales and administrative cost per unit Number of units manufactured Variable cost of goods manufactured per unit Fixed manufacturing cost per unit $14.00 20,000 $28.00 $12.00 Points Printem Mastery Problem: Variable Costing for Management Analysis Absorption vs. Variablo Method Comparison Absorption Statement Variable Statoment Manufacturing Decisions Shaded cells have feedback 1. Use the income statements on the Absorption Statement and Variable Statement panels to complete the following table for the original production level. Then prepare similar income statements at a production level 10,000 units higher and add that information to the table. Assume that total fixed costs, unt variable costs, unit sales price, and the sales levels are the same at both production levels Original Production Level-Absorption Income From Operations Original Additional Production 10,000 Level-Variable Units-Absorption Additional 10,000 Units-Variable $ $ $ Points 074 Feedback Check My Work Following the examples on the Absorption Statement and Variable Statement panels, recompute income from operations under the absorption and variable cost methods. given that the additional units are manufactured. Don't forget that fed costs will remain the same at any production level within the relevant range. 2 What is the change in income from operations from producing 10,000 additional units under absorption conting? Points: 0/1 Next Check My Work All work saved Email Instructor Save and Exit Submit Assignment for Grading Update w.commissionel Mondo vokietakeAssignmentsession.octor in progressatabe Homewo Entrem Mastery Problem: Variable Costing for Management Analysis Absorption vs. Variable Method Comparison Absorption Statement Variable Statement Shaded colonave feedback Manufacturing Decisions 3. What is the change in income from operations from producing 10.000 additional units under variable costing? Points 011 Feedback Check My Work Review your chart and determine the change in income from operations, focusing only on the change ip variable costing amounts. 4. What would be your recommendation to the production manager? Do not produce the extra 10,000 units. The increase in income from operations under absorption costing is due to faced manufacturing costs being held in inventory, and the additional inventory will lead to higher handling, storage, financing, and obsolescence costs. O Produce the extra 10,000 units. Income from operations will be increased, and the production manager will receive praise for creating higher profits. O Produce the extra 10,000 units. It's always a good idea to have extra units on hand and keep the factory operating at capacity, even if all the units are not sold. O Do not produce the extra 10,000 units. Income from operatione does not change under absorption costing when the additional units are produced Points 1/1 Next > Check My Work All work saved. Email Instructor Save and Exde Submit Assignment for Grading Mastery Problemi Variable Costing for Management Analysis Absorption vs. Variable Method Comparison Absorption istement Variable statement Shaded Manufacturing Decisions Absorption Statement 3. Abortion cong coes not gunstween Variantiems. Ar manicuring cows are included in our or gooon 671 Sion, Inc Absorption Costing Income Statement For the Your Ended December 31 Sales $1,200,000.00 SODO 800,000.00 + ind (700.000.00) 1 Cost of goods sold Beginning inventory Cost of goods manufactured Ending Inventory Total cost of goods sold Gross profit Selling and administrative pemes Income from operations 600,000.00 $600,000.00 275,000.00 $325.000.00 1/1 Check My Work Email Instructor Save and Exit Sub Assignment All work saved Cer 20 Homewo Printem Mastery Problemi Variable Costing for Management Analysis TAL Absorption vs. Variable Method Comparison Absorption St Varatten Shaded call rave toedink Manufacturing Decisions Absorption Statement Variable Statement Variable Costing Income Statement For the Year Ended December 31 $1,200,000.00 Sales 1 Variable cost of goods sold 1 $0.00 Beginning inventory Variable cost of goods manufactured 560,000.00 (140,000.00 Ending inventary Total variable cost of goods sold . 420,000.00 Manufacturing margin Variable selling and administrative expenses $780,000.00 210,000.00 Contribution margin $570,000.00 10 Fixed costs 11 Fixed manufacturing costs 1 Fixed selling and administrative expenses $240,000.00 65,000.00 13 Total fixed costs 305,000.00 Income from operations $265.000.00 Check My Work All work saved Email Instructor Save and Exit Submit Assignment Print Item Mastery Problem: Variable Costing for Management Analysis Absorption vs. Variable Method Comparison Absorption Statement Variable Statement Absorption vs. Variable Method Comparison Shaded cells have Shaded calls have Review the income statements on the Absorption Statement and Variable Statement panels, then complete the following table. The company's sales price per unit is $80 cm number of units in ending inventory is 5,000. Item Amount 15,000 Number of units sold Variable sales and administrative cost per unit Number of units manufactured Variable cost of goods manufactured per unit Fixed manufacturing cost per unit $14.00 20,000 $28.00 $12.00 Points