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Each desk is budgeted to require 4 kg of wood at £3 per kg, 4 hours of labour at £2 per hour, and variable production overheads of £5 per unit. Fixed production overheads are budgeted at £20,000 per month and average production is estimated to be 10,000 units per month. The selling price is fixed at £35 per unit. There is also a variable selling cost of £1 per unit and fixed selling cost of £2,000 per month. During the first two months X plc expects the following levels of activity: January February Production 11,000 units 9,500 units Sales 9,000 units 11,500 units (a) Prepare a cost card using absorption costing and marginal costing.

Each desk is budgeted to require 4 kg of wood at £3 per kg, 4 hours of labour at £2 per hour, and variable production overheads of £5 per unit. Fixed production overheads are budgeted at £20,000 per month and average production is estimated to be 10,000 units per month. The selling price is fixed at £35 per unit. There is also a variable selling cost of £1 per unit and fixed selling cost of £2,000 per month. During the first two months X plc expects the following levels of activity: January February Production 11,000 units 9,500 units Sales 9,000 units 11,500 units (a) Prepare a cost card using absorption costing and marginal costing.

FINANCIAL ACCOUNTING
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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please calculate absoptional and marginal income statemnmts for the firm

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UCK Furmiture produce one product – desks. Each desk is budgeted to require 4 kg of wood at £3 per kg, 4 hours of labour at £2 per hour, and variable production overheads of £5 per unit. Fixed production overheads are budgeted at £20,000 per month and average production is estimated to be 10,000 units per month. The selling price is fixed at £35 per unit. There is also a variable selling cost of £1 per unit and fixed selling cost of £2,000 per month. During the first two months X plc expects the following levels of activity: January February Production 11,000 units 9,500 units Sales 9,000 units 11,500 units (a) Prepare a cost card using absorption costing and marginal costing.
Transcribed Image Text:UCK Furmiture produce one product – desks. Each desk is budgeted to require 4 kg of wood at £3 per kg, 4 hours of labour at £2 per hour, and variable production overheads of £5 per unit. Fixed production overheads are budgeted at £20,000 per month and average production is estimated to be 10,000 units per month. The selling price is fixed at £35 per unit. There is also a variable selling cost of £1 per unit and fixed selling cost of £2,000 per month. During the first two months X plc expects the following levels of activity: January February Production 11,000 units 9,500 units Sales 9,000 units 11,500 units (a) Prepare a cost card using absorption costing and marginal costing.
(a) The UCK Fumiture has noticed considerable fluctuation in time spent and expenses paid to electrician who is on standby for a fixed price plus some extra payment depending upon the urgency and frequency when he is called. Month Hours spent Expenses (£) January 630 7960 February 505 7410 March 705 8285 April Мay 555 7535 780 9110 June 800 9840 Using the high-low method, accurately calculate the fixed cost and variable cost and estimate the expenses if the number of hours required for July and August is 650 and 750 respectively. (b) From the following given data apply the inventory valuation technique. UCK reports the following transactions for 2019: Date Purchases Purchase Cost May 15 100 units £1,000 Aug 18 200 units 2,200 Sep 19 130 units 1,800 430 units £5,000
Transcribed Image Text:(a) The UCK Fumiture has noticed considerable fluctuation in time spent and expenses paid to electrician who is on standby for a fixed price plus some extra payment depending upon the urgency and frequency when he is called. Month Hours spent Expenses (£) January 630 7960 February 505 7410 March 705 8285 April Мay 555 7535 780 9110 June 800 9840 Using the high-low method, accurately calculate the fixed cost and variable cost and estimate the expenses if the number of hours required for July and August is 650 and 750 respectively. (b) From the following given data apply the inventory valuation technique. UCK reports the following transactions for 2019: Date Purchases Purchase Cost May 15 100 units £1,000 Aug 18 200 units 2,200 Sep 19 130 units 1,800 430 units £5,000
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