3.16A company had income of P40,000 using variable costing for a given period. Beginningand ending inventories for that period were 18,000 and 13,000 units, respectively. Ignoringincome taxes, if the fixed overhead application rate was P7 per unit, what would the income beif absorption costing was used?3.17A company had income of P30,000 using absorption costing for a given period.Beginning and ending inventories for that period were 13,000 and 18,000 units, respectively. Thefixed overhead application rate was P2 per unit. (Ignore income taxes). What would the incomebe if variable costing was used?3.18Perspire company produces a single product. Last year, the company's net operatingincome computed using absorption costing method was P6,400 and its operating incomecomputed using variable costing method was P9,100. The company's unit product cost was P16under variable costing and P20 under absorption costing. If the ending inventory consisted of2,100 units, the beginning inventory in units must have been3.19Franz began business at the start of this year and had the following costs: variablemanufacturing cost per unit, P9 (DM is P5); fixed manufacturing costs, P60,000; variable sellingand administrative costs per unit, P2; and fixed selling and administrative costs, P220,000. Thecompany sells its units for P45 each. Additional data follow:Planned production in unitsActual production in unitsNumber of units sold10,00010,0008,000Compute for the net income/(loss) under absorption, variable and throughput costing

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3.16 A company had income of P40,000 using variable costing for a given period. Beginning and ending inventories for that period were 18,000 and 13,000 units, respectively. Ignoring income taxes, if the fixed overhead application rate was P7 per unit, what would the income be if absorption costing was used?

3.16 A company had income of P40,000 using variable costing for a given period. Beginning and ending inventories for that period were 18,000 and 13,000 units, respectively. Ignoring income taxes, if the fixed overhead application rate was P7 per unit, what would the income be if absorption costing was used?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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