Variable costing versus absorption costing Yellowstone Fabricators uses a process cost system and applies actual factory overhead to work in process at the end of the month. The following data came from the records for March: E10-1 Direct materials.... $200,000 Direct labor.... $100,000 Variable factory overhead... $ 80,000 Fixed factory overhead.. $ 60,000 ..... .. ..... Selling and administrative expenses $ 40,000 ..... Units produced... 25,000 Units sold..... 20,000 25 Selling price per unit... There were no beginning inventories and no ending work in process inventory. From the information presented, compute the following: 1. Unit cost of production under absorption costing and variable costing. 2. Cost of the ending inventory under absorption costing and var- iable costing. %24

Variable costing versus absorption costing Yellowstone Fabricators uses a process cost system and applies actual factory overhead to work in process at the end of the month. The following data came from the records for March: E10-1 Direct materials.... $200,000 Direct labor.... $100,000 Variable factory overhead... $ 80,000 Fixed factory overhead.. $ 60,000 ..... .. ..... Selling and administrative expenses $ 40,000 ..... Units produced... 25,000 Units sold..... 20,000 25 Selling price per unit... There were no beginning inventories and no ending work in process inventory. From the information presented, compute the following: 1. Unit cost of production under absorption costing and variable costing. 2. Cost of the ending inventory under absorption costing and var- iable costing. %24

Name: EXERCISESVariable costing versus absorption costingYellowstone Fabric
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Description: EXERCISESVariable costing versus absorption costingYellowstone Fabricators uses a process cost system and appliesactual factory overhead to work in process at the lend of themonth. The following data came from the records for March:E10-1L01Direct ma

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Concept explainers

Variance Analysis

In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.

Standard Costing

The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.

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Question

EXERCISES
Variable costing versus absorption costing
Yellowstone Fabricators uses a process cost system and applies
actual factory overhead to work in process at the lend of the
month. The following data came from the records for March:
E10-1
L01
Direct materials....
$200,000
Direct labor.
$100,000
Variable factory overhead..
$ 80,000
Fixed factory overhead.
$ 60,000
Similar to
$ 40,000
25,000
Recall and Review 1
Selling and administrative expenses
Units produced...
Units sold...
20,000
Selling price per unit...
$25
There were no beginning inventories and no ending work in
process inventory.
From the information presented, compute the following:
1. Unit cost of production under absorption costing and variable
costing.
2. Cost of the ending inventory under absorption costing and var-
iable costing.
Comparative income statements-variable and absorption costing
Using the information presented in E10-1, prepare comparative
income statements for March (a) under absorption costing and
(b) under variable costing.
E10-2
L01
24
E10-3
Using variable costing and absorption costing

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CASE: The following data for the month of September were taken from the cost records of Department 1 of Pro-life Products which uses process costing system: Opening inventory of work in process: Units: 500 (with all materials added and 50% of labor and overhead) Cost: ■ Materials.. ■ Labor..... ■ Factory Overhead. ■ Materials.. ■ Labor........ ■ Factory Overhead. ..P14,900 Completed and transferred: 4,800 units Ending Inventory of work-in-process: Units: 700 (with all materials, and 60% of labor and overhead) REQUIREMENT: Upload a document containing your answers for the requirements below. Prepare a complete cost of production report using weighted average cost method containing the following: A. Accounting for the physical flow of units B. Equivalent units of production (EUP) C. Costs, identifying the cost per equivalent unit D. Cost Assignment, showing total cost to account and cost accounted for. ..P2,400 .P1,500 .P760 .P25,100 P19,380 Put into production Units: 5,000 Cost: