How do you account for closing inventory when it is negative? i have also included my solution. PumpsJo pumps started up on 1 Jan 2022. In 20x2 and 20x3 production and sales were asfollows. Selling price was $10. The information below relates to production andcostsPumps manufacturedPumps soldSelling priceRaw materialsOther variable costsFixed costs20x211,0009,000$10$14,300$18,700$68,20020x310,00011,000$10$13,000$17,000$68,200RequiredCalculate the gross profit or loss for both years using marginal and absorptioncosting. Comment of the differences in the results. A345pumps manufactured6pumps sold7 Opening inventory8selling price9raw materials10 other variable costs11 fixed costs12 Closing inventory131415 Marginal costing16 Other variable costs per unit17 Raw materials cost per unit18 Total production cost per unit1920 Sales revenue21 Cost of goods sold22 Open Inventory23 raw materials24 other variable costs25 Less: Closing inventory26 Contribution27 Fixed costs28 Profit/Loss2930 Absorbtion Costing3132 Total overhead33 units produced34 Overhead per unit35 manufacturig price3637 Sales Revenues38 Cost of Goods sold39 Opening Inventory40 Production41 Less: Closing inventory42 Profit/Loss434420x2B11.0009.000$0$10$14.300$18.700$68.200$6.000$2$1$3$90.000$0$14.300$18.700$6.000$63.000$68.200-$5.200$68.20011.000$6,20$9,20$90.000$0$101.200$18.400$7.20020x3C10.00011.000$6.000$10$13.000$17.000$68.200-$3.000$2$1$3$110.000$6.000$13.000$17.000-$3.000$77.000$68.200$8.800$68.20010.000$6,82$9,82$110.000$18.400$98.200-$9.820$3.220D

Answered: Image /qna-images/answer/0fe71dea-ca11-47f0-8208-c7b2ca437059.jpg

Pumps Jo pumps started up on 1 Jan 2022. In 20x2 and 20x3 production and sales were as follows. Selling price was $10. The information below relates to production and costs Pumps manufactured Pumps sold Selling price Raw materials Other variable costs Fixed costs 20x2 11,000 9,000 $10 $14,300 $18,700 $68,200 20x3 10,000 11,000 $10 $13,000 $17,000 $68,200 Required Calculate the gross profit or loss for both years using marginal and absorption costing. Comment of the differences in the results.

Pumps Jo pumps started up on 1 Jan 2022. In 20x2 and 20x3 production and sales were as follows. Selling price was $10. The information below relates to production and costs Pumps manufactured Pumps sold Selling price Raw materials Other variable costs Fixed costs 20x2 11,000 9,000 $10 $14,300 $18,700 $68,200 20x3 10,000 11,000 $10 $13,000 $17,000 $68,200 Required Calculate the gross profit or loss for both years using marginal and absorption costing. Comment of the differences in the results.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

What happens if inventory decline in value?
What factors might impact on the management’s selection of an inventory cost flow assumption? In your answer you need to provide explanation on what factors could impact on a manager to choose FIFO, LIFO or the average cost method. In your answer you may want to refer to issues such as the impact of various cost flow assumptions on the income statement or the statement of financial position. List four factors in your answer
Which of the following is correct about the Limitations of accounting? Select one: O a. Accounting not looks at quality aspect b. there is no bias in accounting c. Price level changes consider in accounting O d. none of the options are correct
Provide examples of some procedures that can avoid inventory shrinkage.
How can we prevent inventory from being reordered automatically each time the system detects a low inventory level
If a misstatement of inventory occurs, the net income for-----periods will be misstated
According to IAS 2, inventory must be reflected at the lower of cost and net realisable value. Which one of the following is not an indicator of possible adjustments to the net 8. realisable value? 1. A decline in selling prices. 2. Decrease in selling costs. 3. Damaged inventories. 4. Wholly or partially obsolete inventories.
Which of the following costs will not affect cost of goods sold? Multiple Choice Inventory inspection costs. Inventory preparation costs. Inventory-related selling costs. O Freight charges incurred to bring inventory to the warehouse.
Discuss how the inventory process supports the production planning process and the risks to the production process if inventory process control goals are not achieved. do not limit your discussion to losses from fraud.