Basic standard cost data of Zahoor & Co. is as under: Normal Capacity (monthly) 50,000 units Production, October, 2007 45,000 units Sales October, 2007 47,500 units Standard variable costs per unit: Rupee(s) Material and labour 8.00 Factory overhead 2.00
Basic
Normal Capacity (monthly) 50,000 units
Production, October, 2007 45,000 units
Sales October, 2007 47,500 units
Standard variable costs per unit: Rupee(s)
Material and labour 8.00
Factory
Distribution expenses 1.00
Operating variances:
Representing excessive incurrence of variable costs Rs.4,500
Selling price per unit Rs.20
Fixed cost for October, 2007:
Manufacturing expenses (Rs.4/- per unit on normal capacity) Rs.200,000
Distribution expenses 75,000
Administration expenses 50,000
Others 25,000
Required:
- Prepare income statement for the month of October, 2007 under:
- Absorption Costing, and
- Marginal Costing
Prepare a reconciliation of incomes under absorption costing and marginal costing for October, 2007.
Note please solve it step by with reconciliation don't copy-paste from other links as those answers are incorrect they dont have reconcilition
Step by step
Solved in 4 steps
