Evaluate the operating income under variable

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Reference no: EM1311163

Computing the operating income under variable costing and absorption costing method.

Below is presented information regarding the production process of a Manufacturing Co. for a two month period.

	Month 1	Month 2
Beginning inventory in units	0	200
Units Produced	1,000	1,000
Units Sold	800	1,200
Sales	$200,000	$240,000
Material Costs	$50,000	$50,000
Variable Conversion costs used	$20,000	$20,000
Indirect Conversion costs	$7,800	$7,800
Indirect Operating costs	$20,000	$20,000

Required:

Evaluate the operating income under variable costing and absorption costing for each month.

Reference no: EM1311163

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