Exam 8: Alternative Inventory Costing Methods: a Decision-Making Perspective

Use the following information for items Green Company sells its product for $11,000 per unit.Variable costs per unit are: manufacturing, $6,000; and selling and administrative, $125.Fixed costs are: $30,000 manufacturing overhead, and $40,000 selling and administrative.There was no beginning inventory at 1/1/18.Production was 20 units per year in 2018-2020.Sales were 20 units in 2018, 16 units in 2019, and 24 units in 2020. -Income under variable costing for 2020 is

Absorption costing

Under absorption costing when production equals sales in a year,

Under absorption costing

Which of the following statements if false?

Which of the following is false?

Use the following information for items Green Company sells its product for $11,000 per unit.Variable costs per unit are: manufacturing, $6,000; and selling and administrative, $125.Fixed costs are: $30,000 manufacturing overhead, and $40,000 selling and administrative.There was no beginning inventory at 1/1/18.Production was 20 units per year in 2018-2020.Sales were 20 units in 2018, 16 units in 2019, and 24 units in 2020. -Income under variable costing for 2019 is

Use the following information for items Obama Company sells its product for $25 per unit.During 2020, it produced 20,000 units and sold 15,000 units (there was no beginning inventory).Costs per unit are: direct materials $5, direct labour $4, and variable overhead $3.Fixed costs are: $300,000 manufacturing overhead, and $50,000 selling and administrative expenses. -The per-unit manufacturing cost under variable costing is

Under variable costing

When comparing absorption and variable costing which of the following is false?

Use the following information for items Green Company sells its product for $11,000 per unit.Variable costs per unit are: manufacturing, $6,000; and selling and administrative, $125.Fixed costs are: $30,000 manufacturing overhead, and $40,000 selling and administrative.There was no beginning inventory at 1/1/18.Production was 20 units per year in 2018-2020.Sales were 20 units in 2018, 16 units in 2019, and 24 units in 2020. -Income under absorption costing for 2019 is

When units produced exceeds units sold

Use the following information for items Obama Company sells its product for $25 per unit.During 2020, it produced 20,000 units and sold 15,000 units (there was no beginning inventory).Costs per unit are: direct materials $5, direct labour $4, and variable overhead $3.Fixed costs are: $300,000 manufacturing overhead, and $50,000 selling and administrative expenses. -The per-unit manufacturing cost under absorption costing is

Use the following information for items Green Company sells its product for $11,000 per unit.Variable costs per unit are: manufacturing, $6,000; and selling and administrative, $125.Fixed costs are: $30,000 manufacturing overhead, and $40,000 selling and administrative.There was no beginning inventory at 1/1/18.Production was 20 units per year in 2018-2020.Sales were 20 units in 2018, 16 units in 2019, and 24 units in 2020. -Income under absorption costing for 2020 is

Under GAAP,

Under absorption costing when production exceeds sales in a year,

Which of the following statements about absorption costing is true?

Under absorption costing