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Variable cost and absorption cost Dundee makes cakes provides the following information: $ Materials/unit 2 Labour/unit 3 Variable production overhead/unit 3 Total fixed production overhead
Variable cost and absorption cost
Dundee makes cakes provides the following information:
$ | |
---|---|
Materials/unit | 2 |
Labour/unit | 3 |
Variable production overhead/unit | 3 |
Total fixed production overhead | 40,000 |
Variable selling cost/unit | 1 |
Total fixed selling and admin expense | 20,000 |
Selling price per unit: $20
Required:
- What is the unit product cost using variable costing?
- What is the unit product cost using absorption costing?
- What is the operating income using absorption costing?
- What is the operating income using variable costing?
- Reconcile operating incomes of 2 costing methods.
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