Nazrin Company started business on 1 January 2014. The company produced furniture components and sold it at RM58.00 each unit On 2015 the actual production of the company is 125,000 units and 112.000 units were sold during the year Opening stock was 5,000 units Factory cost and administration expenses for year 2015 is as below. Direct material Direct labour Production overhead Selling expenses Administration expenses Fixed cost (RM) 700,000 70,000 90,000 Variable cost (RM) 3.90 per unit 4.65 per unit 4.95 per unit 1.00 per unit The budgeted production overhead is RM825,000, budgeted production is 150,000 units You are required to: a) Display total product cost per unit under Absorption Costing b) Display the over or under absorbed of overhead c) Construct the Income Statement of Nazrin Company using the absorption costing method

Nazrin Company started business on 1 January 2014. The company produced furniture components and sold it at RM58.00 each unit On 2015 the actual production of the company is 125,000 units and 112.000 units were sold during the year Opening stock was 5,000 units Factory cost and administration expenses for year 2015 is as below. Direct material Direct labour Production overhead Selling expenses Administration expenses Fixed cost (RM) 700,000 70,000 90,000 Variable cost (RM) 3.90 per unit 4.65 per unit 4.95 per unit 1.00 per unit The budgeted production overhead is RM825,000, budgeted production is 150,000 units You are required to: a) Display total product cost per unit under Absorption Costing b) Display the over or under absorbed of overhead c) Construct the Income Statement of Nazrin Company using the absorption costing method

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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