Solution-What profit would have been earned

What profit would have been earned

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Problem - A company uses standard absorption costing to value inventory. Its fixed overhead absorption rate is $12 per labour hour and each unit of production should take four hours. In a recent period where there was no opening inventory of finished goods, 20,000 units were produced using 100,000 labour hours. 18,000 units were sold. The actual profit was $464,000. What profit would have been earned under a standard marginal costing system?

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What profit would have been earned

Reference no: EM133005138

Reference no: EM133005138

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