How much is the operating income if the company uses variable costing?

Q: What is the difference between absorption costing and variable costing? 2. Distinguish between…

A: Cost accounting:  It is a part of managerial accounting  and is used to record  total cost of…

Q: What are the differences between a company using absorption costing and variable costing when they…

A: Absorption Costing : It is one of the methods of calculation of product costs. Under this method,…

Q: The following data were provided by Rider, Inc, which produces a single product that it sells for…

A: Absorption costing is that costing system under which product costs includes all manufacturing costs…

Q: On an income statement prepared using variable costing, to calculate contribution margin, a company…

A: The objective of the question is to understand what costs are subtracted from sales to calculate the…

Q: How can variable costing income statement be used in manufacturing enterprises?

A: In a Variable costing income statement, all variable costs are deducted from the sales, to compute…

Q: Why is it appropriate to use variable costing when planning production in the short term?

A: Variable Cost: The cost which is not fixed is called as variable cost. This cost is directly…

Q: Why is absorption costing the method allowable for GAAP yet managers prefer variable costing

A: In variable costing only variable costs are included in the product cost. Fixed costs re considered…

Q: Explain why there is a difference in the operating profit and operating income under the two methods…

A: The product cost in an absorption costing method includes all variable and fixed production…

Q: Explain the effect of a decrease in the level of activity (cost driver) on: (i) total fixed cost…

A: Lets understand the basics. Fixed cost are cost which do not change with level of output. In other…

Q: What effect does an increase in volume have on—c. Total fixed costs?

A:

Q: When will NOI under the variable costing method show higher income than under the absorption costing

A: Net Operating Income: It is a calculation used to assess the profitability of the business.

Q: When output volume increases, do fixed costs per unit increase, decrease, or stay the same within…

A: Fixed Costs:   These are the costs that remain constant in total dollar amount irrespective to the…

Q: Give an example of how, under absorption costing, operating income could fall even though the unit…

A: Definition:   Absorption Costing: The absorption costing is a method used to allocate the fixed…

Q: . Which of the following is the best definition of a variable cost? A. A variable cost is one which…

A: Variable costs are the costs that vary on the basis of the level of output. They are determined per…

Q: How can variable costing be used in service companies?

A: Variable Costing: The variable costing is the method of costing in which only the variable…

Q: Which of the following line items will not be found in the absorption costing income statement?…

A: The objective of the question is to identify which line item among the given options will not be…

Q: In detail discuss what are  the advantages and disadvantages of using FIFO for process costing. In…

A: First-in First-out(FIFO) method under process costing is based on the assumption that at the…