Maria Garcia Essay

614 words - 3 pages

Marcella Puente
Ending Finished Goods inventory cost under absorption costing would be
Ending Finished Goods inventory cost under Variable costing would be
Absorption costing includes all manufacturing costs including direct materials, direct labor, and both variable and fixed manufacturing overhead.
Variable costing includes only variable manufacturing costs --- direct materials, direct labor, and variable manufacturing overhead.

The 200 is from the units produced - units sold = 200


Var mfg - cost/unit non-mfg – cost/unit
120000/15000=8.0 24000/12000=2.0
Operating Income
...view middle of the document...

Consider the following data regarding factory overhead:
Variable Fixed
Budget for actual hours of input $45,000 $70,000
Applied 41,000 64,800
Budget for standard hours allowed
for actual output achieved ? ?
Actual incurred 48,500 68,500
Using the above data, fill in the following blanks with the variance amounts. Use F for favorable or U
for unfavorable for each variance.
                            Total Overhead                &n bsp;  Variable                    Fixed
1. Spending variance ______                        _ _____                          ______
2. Efficiency variance ______             &n bsp;            ______                        ______
3. Production-volume variance ______               ______                      ______
4. Flexible-budget variance ______     & nbsp;             ______                     ______
5. Underapplied overhead ______&n bsp;                    ______                      ______

Note that the budget for standard hours allowed for actual output achieved for variable overhead must be $41,000, the same as applied. In contrast, the budget for...

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