Prepare the income statement of Grant Limited

Assignment Help Accounting Basics
Reference no: EM133106105

Question - Grant Ltd manufactures a gadget. The following information relates to March 2021:

Sales (number of gadgets)


15,000

Selling price per unit


110

Manufacturing cost of gadgets:



Variable


468,750

Fixed


187,500

Selling and administrative cost:

5

93,750

Fixed selling cost


50,000

Fixed administration cost


12,500

Inventory of gadgets at 31 March 2021

3,750 units


Only 15,000 of the 18,750 units were sold during March 2021.

Required -

a) Prepare the income statement of Grant Limited using the variable costing method.

b) Prepare the income statement of Grant Limited using the absorption costing method.

c) Explain why the net profit before tax differs between the variable and absorption cost methods.

d) Indicate which method should be used for monthly management accounts.

Reference no: EM133106105

Questions Cloud

Complete training materials : Technology in training can be an effective tool since employees can complete training materials anytime and anywhere they have an Internet connection. However,
What is your estimate of the stock current price : A company currently pays a dividend of $2.6 per share (D0 = $2.6). What is your estimate of the stock current price
Please define what integrity means : Please define what integrity means to you and share with us some core values that are most important to you, both in business and in life.
Develop contextually appropriate recommendations : Referring to a specific organisational context, critically evaluate how the selected organisation integrates digital learning into its overall learning strategy
Prepare the income statement of Grant Limited : Only 15,000 of the 18,750 units were sold during March 2021. Prepare the income statement of Grant Limited using the absorption costing method
Discuss the ethical dilemma in the case : Case Study - Facebook In Face of Crisis and Discuss the ethical dilemma in the case
Explain the four basic functions : Explain the four basic functions make up the management process and how these functions are interrelated to one another. Give a specific example or scenario to
Dama guide to the data management body of knowledge : According to the The DAMA Guide to the Data Management Body of Knowledge, "There are two types of ethics: compelled ethics and imposed ethics. Compelled ethics
Calculate the breakeven units and breakeven value : The following information is obtained from the budget for the month ending 30 October: Calculate the breakeven units and breakeven value

Reviews

Write a Review

Accounting Basics Questions & Answers

  What is the total amount of dividends

If Valley has sufficient funds to pay? dividends, what is the total amount of dividends that will be paid out to preferred? stockholders

  Focus company property plant and equipment disclosures

Focus company property, plant, and equipment disclosures. In Exercise 1.1, you were asked to obtain the most recent annual report of a company that you were interested in reviewing throughout this term.

  Journalize the entries for the issuance of the note and the

on january 1 2012 daan company obtained a 28000 four-year 9 installment note from poklers bank. the note requires

  Discuss the application of the principles of consideration

Discuss the application of the principles of consideration and injurious reliance/equitable estoppel to the facts of this case. Will the University or Patrick

  Members for official purposes and essential personal message

I would like to remind all the staff members that they are not permitted to use the company properties such as computers and internet for any unnecessary works. The computers are provided to the staff members for official purposes and essential pe..

  What is the incremental revenue associated

Suppose this action will increase sales to 313,500 jars of sauce. What is the incremental revenue associated with the price reduction of sauce

  Prepare the appropriate journal entries for each transaction

ABC Inc. has the following stockholders' equity on January 1, 2013: Retained earnings $6,000,000. Prepare the appropriate journal entries for each transaction

  Explain the various business segments the company

Explain the various business segments the company

  Why are the terms of the articles of partnership important

The major providers of financing in some countries are stockholders, while other countries predominantly use banks as the main financing source.

  Compute the basic earnings per share

On January 1, 2018 , CDE corporation has 10,000 ordinary shares outstanding. Compute the basic earnings per share

  Why are most large companies like microsoft

Why are most large companies like Microsoft, PepsiCo, Caterpillar, and AutoZone organized as corporations?

  What taxes are calculated on payroll payments of full-time

What taxes are calculated on the payroll payments of full-time (40-hour) employees who additionally receive sales commissions?

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!

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