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(1)
Absorption costing is a process that the company uses to allocate all types of costs on all products, and then calculates the final price of the products.
Variable costing considers only the variable costs and it is not used for external purpose. However, the company uses this method for their own internal management.
To discuss:
The type of costing method used by Company A to prepare their income statement.
(2)
Inventory means the goods which are available for sale during the year. At the end of the financial year, if the company has some inventory which is unsold, then it is shown on asset side of the
The amount inventory shown in company-A’s balance sheet for the year 2016 and 2017.
(3)
Variable costing considers only the variable costs and it is not used for external purpose. However, the company uses this method for their own internal management.
To compute:
Net income under variable costing method.
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Chapter 6 Solutions
Managerial Accounting - Connect Access
- Provide answer accounting question with calculationarrow_forwardThe following data were taken from the records of Skysong Company for the fiscal year ended June 30, 2025. Raw Materials Inventory 7/1/24 $51,600 Accounts Receivable $35,400 Raw Materials Inventory 6/30/25 45,500 Factory Insurance 5,200 Finished Goods Inventory 7/1/24 Finished Goods Inventory 6/30/25 99,100 Factory Machinery Depreciation 17,900 22,300 Factory Utilities 31,100 Work in Process Inventory 7/1/24 29,600 Office Utilities Expense 9.450 Work in Process Inventory 6/30/25 28,100 Sales Revenue 557,100 Direct Labor 145,750 Sales Discounts 5,000 Indirect Labor 26,660 Factory Manager's Salary 65,300 Factory Property Taxes 9.710 Factory Repairs 2,200 Raw Materials Purchases 99,000 Cash 39.400arrow_forwardchois best answerarrow_forward
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