A Company started its business in 2010 producing luxury handbags for young ladies.The normal production of handbags at an average of 3,300 units annually. The actual productionsales for the year 2019, 2020 and 2021 are as followsYear201920202021Actual production(units)2,4003.3004,200Sales(units)2,0003,5004,000The selling price, cost and expenses for the handbags are:RMSelling price per handbagDirect raw materials costs per handbagDirect labour costs per handbagVariable manufacturing overhead per handbagFixed manufacturing overhead per monthSales commissionSelling and administrative expenses per month10,0005,0002,0001,000330,00010% on sales198,000Requireda) Calculate the product cost per unit of handbag by using absorption costing and variable costingb) Prepare the income statement for year 2019, 2020 and 2021 by using absorption costing

Absorption costing refers to the process of computing the expenses regarding a product using its…

Answered: handbags at an average of 3,30 120 and…

Business

Accounting

handbags at an average of 3,30 120 and 2021 are as follows Actual production (units) 2,400 100 T00

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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