Question
XYZhas the following financial information: Current Year Prior Year # Units in Beginning Inventory ? 0 # Units Sold 570,000 580,000 # Units Manufactured (Actual)
XYZhas the following financial information:
|
|
| Current Year | Prior Year |
| # Units in Beginning Inventory |
| ? | 0 |
| # Units Sold |
| 570,000 | 580,000 |
| # Units Manufactured (Actual) |
| 610,000 | 590,000 |
| # Units Manufactured (Budget) |
| 640,000 | 600,000 |
| Selling Price | (per unit) | 10.00 | 9.90 |
| Variable Manufacturing Costs | (per unit) | 5.00 | 4.80 |
| Variable Sales+Admin Costs | (per unit) | 1.00 | 1.00 |
| Fixed Manufacturing Costs (Budget and Actual) | (total) | 1,600,000 | 1,560,000 |
| Fixed sales+admin costs (actual) | (total) | 360,000 | 350,000 |
| Net income (Variable Costing) |
| 322,000 | 468,000 |
Inventory is recorded at FIFO
Required:
- Calculate the value of the Ending Inventory under Absorption Costing and Variable costing for the prior year and current year
- Prepare an income statement under Absorption Costing for the current year
- Reconcile the difference in Operating Income between Variable costing and Absorption Costing for the current year
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The Board Of Directors And Audit Committee Guide To Fiduciary Responsibilities Ten Critical Steps To Protecting Yourself And Your Organization
Authors: Sheila Moran CPA CFE, Ronald Kral CPA CMA
1st Edition
0814431666, 978-0814431665
