23. Citricacid plc budgets during its first year of operations to produce and sell 38,160 litres of product per annum at a selling price of £10 per litre. Citricacid’s budgeted costs are as follows: £ per unit Variable production costs 3.54 Fixed production costs 1.04 Variable selling costs 2.50 In the first year the unit selling price was £10 per litre and the variable unit cost and expenditure on fixed production costs were also as budgeted. Actual sales volume was 38,400 litres and closing inventory was 960 litres. Using absorption costing Citricacid’s profit for the year was:
23. Citricacid plc budgets during its first year of operations to produce and sell 38,160 litres of product per annum at a selling price of £10 per litre. Citricacid’s budgeted costs are as follows: £ per unit Variable production costs 3.54 Fixed production costs 1.04 Variable selling costs 2.50 In the first year the unit selling price was £10 per litre and the variable unit cost and expenditure on fixed production costs were also as budgeted. Actual sales volume was 38,400 litres and closing inventory was 960 litres. Using absorption costing Citricacid’s profit for the year was:
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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23. Citricacid plc budgets during its first year of operations to produce and
sell 38,160 litres of product per annum at a selling price of £10 per litre.
Citricacid’s budgeted costs are as follows:
£ per unit
Variable production costs 3.54
Fixed production costs 1.04
Variable selling costs 2.50
In the first year the unit selling price was £10 per litre and the variable unit
cost and expenditure on fixed production costs were also as budgeted. Actual
sales volume was 38,400 litres and closing inventory was 960 litres.
Using absorption costing Citricacid’s profit for the year was:
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