Chapter 6 Question TFPlease provide an explanation. I am struggling to understand the difference between absorption and variable costing The following data was prepared by the Oriole Company.TotalVariableFixedSales price$22/unitDirect materials used$82,650Direct labor$96,000Manufacturing overhead$113,670$17,910$95,760$22,70025,200 unitsSelling and administrative expense$13,100$9,600Units manufacturedBeginning Finished Goods InventoryEnding Finished Goods Inventory19,200 units7,000 units (b)Under variable costing, what is the unit product cost? (Round answer to 2 decimal places, e.g. 15.25.)Unit product cost$eTextbook and MediaSave for LaterAttempts: 0 of 5 used Submit Answer

Under variable costing, all costs incurred for production that are variable in nature will…

Answered: Under variable costing, what is the…

Business

Accounting

Under variable costing, what is the unit product cost? (Round answer to 2 decimal places, eg. 15.25.) Unit product cost

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Select all that apply Differential cost is Blank ------ between two alternatives the same as…

A: Differential cost analysis is used to choose one alternative from 2 alternatives. It is for decision…

Q: ing control ing relative efficiency short-term, spare capacity de

A: Cost refers to the compiled sum of all the expenses involved while manufacturing a product.

Q: QUESTION 7 Choose the correct statements from the following: O Variable costing and absorption…

A: Variable Costing - In this costing method, variable costs are considered while preparing the cost of…

Q: All the following are true for absorption costing, except O is used for GAAP reporting purposes. O…

A: Hi studentSince there are multiple questions, we will answer only first question.Absorption costing…

Q: Ch. 5 Fixed Costs/Per Unit Pleaes explain the following concept/rule and give an example: Why do…

A: Fixed cost is a cost which is constant in the short run, it is not related to any change in the…

Q: A Report a Problem O Revisit Choose the best option Question # 2 With reference to cost…

A: The costs in the production process can be classified on a different basis, for financial reporting…

Q: 6. What are costs that vary in proportions to changes in the activity base?

A: In cost accounting, different types of costs are incurred and accounted for. Some costs do not…

Q: Cost Behavior Ch. 6 Please provide the Break-Even formula and give an example and explain the…

A: Break-even is considered as break-even point.

Q: Q.List four reasons for using standard costs

Q: Explain the difference between full absorption costing and direct costing. How does absorption…

A: Full absorption costing and direct costing are two different approaches to calculating the cost of…

Q: What are the different type of costs? Describe each.

A: In cost accounting, The accounting process deals with the total costs incurred in the production…

Q: 24 What is Cost object in Activity based costing? a. It is an item for which cost measurement is…

A: answer

Q: Define the meaning of cost. Please help me I really need the answer, clear explanation please, thank…

A: Cost: It refers to the monetary expenditure that a firm must incur in order to purchase or hire the…

Q: quired B have limited time to determine why actual nvestigate to see why actual and budgeted

A: Budgeting is a process of estimating income and expenses for the upcoming period so that informed…

Q: In a special order situation, any fixed cost associated with the order is irrelevant cost. True…

A: This question deals with the concept of relevant costing. In special order situation, generally all…

Q: Which of the following statements is true? * O a. A common cost is one type of direct cost. O b. A…

A: The question is related to Choose which of the statement is true.

Q: QUESTION 5 When trying to decide between multiple alternatives, a cost that occurs in the future and…

A: Relevant cost means the cost which is considered while taking the decision. All variable cost and…

Q: What is the main difference between absorption costing and variable costing system. How does…

A: Absorption costing is a method of costing used to account for all manufacturing costs particular to…

Q: Overhead Cost Area Admin and General Info and Telecomm Sales and Marketing Utilities Prop Maint…

A: Overheads means all type of indirect costs being incurred in business. These costs can not be…

Q: Current Attempt in Progress The underlying principle that absorption costing satisfies is the O…

A: Absorption Costing is a management accounting method for accumulating all costs associated with…

Q: Describe the behavior of fixed and variable costs as activity levels change. Use graphs to…

A: Answer:- Fixed cost meaning:- Fixed costs are expenses that remain constant regardless of whether…

Q: 7.14 How can deviations be used to analyze costs in separate areas of activity?

A: Cost variance analysis is used under both traditional and activity based costing methods. The only…

Q: Which costing system is helpful for internal managers when they're trying to make a short- term…

A: Cost Accounting is a process of identification, classification, measurement, and assignment of costs…

Q: 1. Total variable cost is affected by changes in activity and per unit variable cost is constant

A: Total Cost Consists of Two Components which is Fixed cost and Variable cost. The Behavior of these…

Q: Fixed costs expressed on a per unit basis:

A: Variable cost is the cost that varies with the change in output. Whereas, the per unit variable cost…

Q: (c) Describe a situation where net profit under variable costing is higher than absorption JIT…

A: Variable costing is a costing method in which overhead is incurred in the period of production of…

Q: WITHIN THE RELEVANT RANGE OF ACTIVITY, HOW WILL A VARIABLE COST PER UNIT BEHAVE?

A: Costs classification means grouping costs according to their common characteristics . On the basis…

Q: 3. The sales level at which operating income is zero. Drop in sales a company can absorb without…

A: Break even analysis involves determination of sales level at which the firm's total revenue equals…

Q: QUESTION 7 Sunk costs, unitising costs, how costs are allocated, and leaving out opportunity costs…

A: QUESTION 7 Sunk costs, unitising costs, how costs are allocated, and leaving out opportunity costs…

Q: Question 2 Compare and contrast absorption and marginal costing.

A: The income statement is prepared on the basis of Marginal costing or absorption costing.

Q: Direct costs minus indirect costs equal total costs Select one: O True False

A: Direct cost means Directly related to production of output Example : Direct material ,Direct…

Q: The scattergraph is a useful tool for:

A: Business managers use the scattergraph method when estimating costs to anticipate operating costs at…

Q: Differential Costs are the difference in cost between any two alternative choices True False

A: Differential cost is the cost difference when two alternatives are projected. It also the cost…

Q: QUESTION 2 [12 MARKS]a) Differentiate between relevant and irrelevant costs. Provide examples (4…

A: Key references: Drury, C. M. (2013). Management and cost accounting. Springer.Horngren, C. T.…

Q: Differentiate variable cost from fixed cost. Hope you

A: The cost function is a function that is used to show how production expense will change at different…

Q: Chapter 21: Cost Behavior and Cost-Volume-Profit Analysis Requirement 1: Please explain variable,…

A: “Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: Please explain step by step how to solve the question for cost allocation by using the double…

A: Cost allocation is the as the name suggests the allocation or in other words, the distribution of…

Q: Differentiate prime cost from conversion cost.

A: Prime cost as the name suggests the main cost without which production can not be done. It is given…

Q: Identify each of these costs as fixed, variable, or mixed.

Q: ou agree from the following statements- Explain in details with Variable costs are controllable but…

A: Statement is TRUE but not entirely True. Variable costs are controllable cost while fixed costs are…

Q: 6- Absorption costing makes an apportionment of indirect costs so that the products absorb these…

A: There are two types of costing methods that are being used in cost accounting. One is absorption…

Q: Question 2 List as many possible bases of absorption (or 'overhead recovery rates') as you can think…

A: Overheads are the indirect costs related to production of goods. This is also known as factory…

Concept explainers

Pricing

Pricing is used as a term in finance and economics, pricing is the process of fixing a value for a product or a service. Pricing establishes a value for a product or service that the customer has to pay. A business can choose from different strategies while deciding to set prices.

Question

Chapter 6 Question TF

Please provide an explanation. I am struggling to understand the difference between absorption and variable costing

The following data was prepared by the Oriole Company.
Total
Variable
Fixed
Sales price
$22/unit
Direct materials used
$82,650
Direct labor
$96,000
Manufacturing overhead
$113,670
$17,910
$95,760
$22,700
25,200 units
Selling and administrative expense
$13,100
$9,600
Units manufactured
Beginning Finished Goods Inventory
Ending Finished Goods Inventory
19,200 units
7,000 units

(b)
Under variable costing, what is the unit product cost? (Round answer to 2 decimal places, e.g. 15.25.)
Unit product cost
$
eTextbook and Media
Save for Later
Attempts: 0 of 5 used Submit Answer

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

2 disadvantages of activity based costing
Question 16 The major part of the The cost-benefit-trade-off problem involves identifying all the activities and benefits that should be considered O True O False
View Policies Current Attempt in Progress Variable costs O vary in total as activity varies. O vary on a per unit basis as activity varies. O are unpredictable. O none of the above. eTextbook and Media Save for Later Attempts: 0 of 3 used Submit Answer
Problem 4 a. What is the difference between relevant, opportunity and sunk costs? b. Why are fixed costs not included in special order decisions? C. What are the steps involved in decision making?
Ma3. What are the benefits and limitations of ABC? Please answer according to the structure below: Intro: Identity what are Activity-based costing ? Body: Direct answer Conclude: up to you.
Question 9 Which of the following is NOT normally associated with activity-based costing? A Improved decision-making and pricing B Multiple cost drivers C Reduction of non-value-adding costs D Activity cost pools E I do not wish to answer this question. F High direct labour costs relative to manufacturing overhead costs
QUESTION 25 In the economic order quantity (EOQ) model, where does the optimal order quantity value exist? O Where holding cost is greater than ordering cost Where ordering cost is minimized Where ordering cost is zero O Where ordering cost equals holding cost. ok Save and Submit to save and submit. Click Save All Answers to save all answers.
“In decision making, full (absorption) costing approach has become entirely useless as it leads to wrong decisions”. Provide examples and evaluate the statement.
2- The ABC costing method * a) is based on the Pareto curve b) is absorption costing c) allows you to track the most important activities d) does not present cost apportionment
1-12 Cost Terms {LO 2} explain how a cost can be controllable at one administrative level and noncontrollable at another administrative level.
Question One Describe the following costing systems: Marginal and Absorption costing Explains the effect on profit of using variable (marginal) and absorption costing. Explain TWO advantages and TWO disadvantages of both marginal and absorption costing systems.
QUESTION 1 Identify and explain two advantages of marginal costing over absorption costing