Uche Ltd produces a single product and the following are the accounting data; Opening stock 20.000 units Production 30,000 units Closing stock 4,000 units The variable production cost per unit is £8 and the fixed production cost is £120,000. The sales revenue is £720,000. Net profit is £ 88,000 based on full absorption costing. What is the profit based on marginal costing? a. £124,000 more than absorption costing profit. b. £134,000 more than absorption costing profit. c. £144,000 more than absorption costing profit d. £154,000 more than absorption costing profit.
Uche Ltd produces a single product and the following are the accounting data; Opening stock 20.000 units Production 30,000 units Closing stock 4,000 units The variable production cost per unit is £8 and the fixed production cost is £120,000. The sales revenue is £720,000. Net profit is £ 88,000 based on full absorption costing. What is the profit based on marginal costing? a. £124,000 more than absorption costing profit. b. £134,000 more than absorption costing profit. c. £144,000 more than absorption costing profit d. £154,000 more than absorption costing profit.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Uche Ltd produces a single product and the following are the accounting data; Opening stock 20.000 units Production 30,000 units Closing stock 4,000 units The variable production cost per unit is £8 and the fixed production cost is £120,000. The sales revenue is £720,000. Net profit is £ 88,000 based on full absorption costing. What is the profit based on marginal costing?
a. £124,000 more than absorption costing profit.
b. £134,000 more than absorption costing profit.
c. £144,000 more than absorption costing profit
d. £154,000 more than absorption costing profit.
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