Throughput Costing: A costing approach that considers only direct material as the cost attributable to inventory is called throughput costing. It is based on the concept that only the raw materials used for production are variable costs and all other costs must be recorded as period costs. To prepare: The income statement of Company C for January, February and March 2014 under throughput costing.

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Answer 1

Question

Chapter 9, Problem 9.19E

1.

To determine

Throughput Costing:

A costing approach that considers only direct material as the cost attributable to inventory is called throughput costing. It is based on the concept that only the raw materials used for production are variable costs and all other costs must be recorded as period costs.

To prepare: The income statement of Company C for January, February and March 2014 under throughput costing.

2.

To determine

To explain: The difference in the operating income as per throughput costing and as per variable and absorption costing.

3.

To determine

To identify: One benefit for Company C to use throughput costing.

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Answer 2

Question

Chapter 9, Problem 9.19E

1.

To determine

Throughput Costing:

A costing approach that considers only direct material as the cost attributable to inventory is called throughput costing. It is based on the concept that only the raw materials used for production are variable costs and all other costs must be recorded as period costs.

To prepare: The income statement of Company C for January, February and March 2014 under throughput costing.

2.

To determine

To explain: The difference in the operating income as per throughput costing and as per variable and absorption costing.

3.

To determine

To identify: One benefit for Company C to use throughput costing.

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Answer 3

Question

Chapter 9, Problem 9.19E

1.

To determine

Throughput Costing:

A costing approach that considers only direct material as the cost attributable to inventory is called throughput costing. It is based on the concept that only the raw materials used for production are variable costs and all other costs must be recorded as period costs.

To prepare: The income statement of Company C for January, February and March 2014 under throughput costing.

2.

To determine

To explain: The difference in the operating income as per throughput costing and as per variable and absorption costing.

3.

To determine

To identify: One benefit for Company C to use throughput costing.

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Answer 4

Question

Chapter 9, Problem 9.19E

1.

To determine

Throughput Costing:

A costing approach that considers only direct material as the cost attributable to inventory is called throughput costing. It is based on the concept that only the raw materials used for production are variable costs and all other costs must be recorded as period costs.

To prepare: The income statement of Company C for January, February and March 2014 under throughput costing.

2.

To determine

To explain: The difference in the operating income as per throughput costing and as per variable and absorption costing.

3.

To determine

To identify: One benefit for Company C to use throughput costing.

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Answer 5

Chapter 9, Problem 9.19E

1.

To determine

Throughput Costing:

A costing approach that considers only direct material as the cost attributable to inventory is called throughput costing. It is based on the concept that only the raw materials used for production are variable costs and all other costs must be recorded as period costs.

To prepare: The income statement of Company C for January, February and March 2014 under throughput costing.

2.

To determine

To explain: The difference in the operating income as per throughput costing and as per variable and absorption costing.

3.

To determine

To identify: One benefit for Company C to use throughput costing.

Answer 6

Chapter 9, Problem 9.19E

1.

To determine

Throughput Costing:

A costing approach that considers only direct material as the cost attributable to inventory is called throughput costing. It is based on the concept that only the raw materials used for production are variable costs and all other costs must be recorded as period costs.

To prepare: The income statement of Company C for January, February and March 2014 under throughput costing.

Answer 7

Chapter 9, Problem 9.19E

1.

To determine

Throughput Costing:

A costing approach that considers only direct material as the cost attributable to inventory is called throughput costing. It is based on the concept that only the raw materials used for production are variable costs and all other costs must be recorded as period costs.

To prepare: The income statement of Company C for January, February and March 2014 under throughput costing.

Answer 8

2.

To determine

To explain: The difference in the operating income as per throughput costing and as per variable and absorption costing.

Answer 9

2.

To determine

To explain: The difference in the operating income as per throughput costing and as per variable and absorption costing.

Answer 10

3.

To determine

To identify: One benefit for Company C to use throughput costing.

Answer 11

3.

To determine

To identify: One benefit for Company C to use throughput costing.

Answer 12

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Answer 13

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Answer 14

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Answer 15

Ch. 9 - Differences in operating income between variable...Ch. 9 - Why is the term direct costing a misnomer?Ch. 9 - Do companies in either the service sector or the...Ch. 9 - Explain the main conceptual issue under variable...Ch. 9 - Companies that make no variable-cost/fixed-cost...Ch. 9 - The main trouble with variable costing is that it...Ch. 9 - Give an example of how, under absorption costing,...Ch. 9 - What are the factors that affect the breakeven...Ch. 9 - Critics of absorption costing have increasingly...Ch. 9 - What are two ways of reducing the negative aspects...

To explain: The difference in the operating income as per throughput costing and as per variable and absorption costing.

To identify: One benefit for Company C to use throughput costing.

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Chapter 9 Solutions