User Account

All Pages

Prepare profit statements using marginal costing

Assignment Help Managerial Accounting
Reference no: EM132896549

Question - At the start of period one Tommy has no opening inventories. Tommy sells his product for £12 per unit incurring the following unit variable costs:

£

Direct materials 4.80

Direct labour 2.00

Variable production overheads 1.20

Fixed production overheads are £3,000, fixed selling overheads are £1,000, and production and sales are as follows:

Pd 1 Pd 2

Sales 1200 units 1800 units

Production 1400 units 1600 units

Overhead absorption rates are calculated based on budgeted production of 1500 units.

Required -

a) Prepare profit statements using marginal costing.

b) Prepare profit statements using absorption costing.

c) Explain why the profit figures differ using the two different methods.

d) Explain why the adjustment is necessary for under and over absorption of overheads in the absorption costing model.

Reference no: EM132896549

Questions Cloud

What is the total gain from restructuring : Land Corporation would be required to make an annual interest payment of P540,000 every December 31 starting 2X22. What is the total gain from restructuring
Strategic communications plan : Do your communications plan, written communication, and presentation plan all align to meet the objectives of your goal? Explain how they align.
Examine movement and specific work in relation to historical : Examine the movement and specific work in relation to historical and political influences of the movement. Include a one paragraph summary
Compute the net present value of the commuter service : Ten drivers would have to be employed at a total payroll expense of 48,000. Compute the net present value of the commuter service
Prepare profit statements using marginal costing : Overhead absorption rates are calculated based on budgeted production of 1500 units. Prepare profit statements using marginal costing
Why changing a transfer price will have no direct effect : Briefly explain why changing a transfer price will have no direct effect on a company's reported profit
Which antihistamine do recommend while working : Your patient works at a garden nursery and has seasonal allergies. Which antihistamine do you recommend while working, Benadryl or Claritin?
What maximum unit purchase price : What maximum unit purchase price would McNamara Company be willing to pay to a subcontractor for the additional 4,000 units
Why is managing cultural diversity important : How do project managers effectively lead multicultural project teams? Discuss how the cultural diversity of the project team/ project stakeholders

Reviews

Write a Review

Managerial Accounting Questions & Answers

  Evaluate the present value index for each proposal

The net present value for Proposals X and Y.Evaluate the present value index for each proposal. Round your answers to two decimal places.

  Identify an internal control procedure

Identify an internal control procedure that would prevent, detect, or deter such a fraudulent scheme. For one of sunbeam's revenue types

  Explain suggest three performance measures

Discuss If the company is successful in achieving challenging targets for these performance measures, will it also necessarily achieve high profitability?

  Construct a balance sheet at the start of the year

Construct a Balance Sheet at the start of the year. The assets for the farm at the start of the year include depreciable assets of K 1,440,000.00

  The statement of cash flows using the direct method

The following accounts and corresponding balances were drawn from Geneses Company's 2014 and 2013 year-end balance sheets:

  What were cianciolo company total manufacturing costs

Manufacturing overhead was calculated at 70% of direct labor costs. What were Cianciolo Company's total manufacturing costs for the year?

  Identifying cost behavior patterns

How would a knowledge of cost behavior patterns such as those above be of help to a manager in analyzing the cost structure of his or her company?

  Required sales in dollars to break even

Presto Corp. had total variable costs of $165,935, total fixed costs of $166,100, and total revenues of $301,70

  Calculate the total joint costs for the last batch

Intermediate Management Accounting Assignment Help and Solution - Compute each departments manufacturing overhead rate, assuming that Opaskwayak uses a normal

  Suitable price per meal for the auditorium

What would be a suitable price per meal for the auditorium to continue to have the Season's Restaurants supply meals? Explain your answer?

  Define and communicate the benefits of new approaches

Why should you take into account impacts on customer service and colleagues when developing new approaches? What problems can occur with reports?

  Develop a cost estimating equation for total manufacturing

Determine the underapplied or overapplied manufacturing overhead at the end of 2018. Develop a cost estimating equation for total manufacturing overhead.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd