EXERCISE 5. Noura designs and sells hand-made jewelry. She incurred the following unit costs to produce 60,000 items. Direct materials AED5.00 Direct labor AED1.80 Variable overhead AEDO.70 AED4.20 Fixed overhead Noura began the year with no inventory. During the year she sold 45,000 items for AED18 each, incurring AEDO.50 in selling costs per item plus AED5,000 in advertising and other selling expenses. a. Calculate the unit product cost and prepare an income statement using the variable costing method. b. During the year she sold 45,000 items for AED18 each, incurring AEDO.50 in selling costs per item plus AED5,000 in advertising and other selling expenses. Under absorption costing, what is Noura's ending Finished Goods Inventory balance?

EXERCISE 5. Noura designs and sells hand-made jewelry. She incurred the following unit costs to produce 60,000 items. Direct materials AED5.00 Direct labor AED1.80 Variable overhead AEDO.70 AED4.20 Fixed overhead Noura began the year with no inventory. During the year she sold 45,000 items for AED18 each, incurring AEDO.50 in selling costs per item plus AED5,000 in advertising and other selling expenses. a. Calculate the unit product cost and prepare an income statement using the variable costing method. b. During the year she sold 45,000 items for AED18 each, incurring AEDO.50 in selling costs per item plus AED5,000 in advertising and other selling expenses. Under absorption costing, what is Noura's ending Finished Goods Inventory balance?

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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