Homework Answers
Solution:
The true statement regarding absorption costing and variable costing and generally accepted accounting principle is "Only Absorption costing is acceptable for external reporting purpose"
Hence option D is correct.
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QUESTION 22 Which of the following statements is true regarding absorption costing (AC), variable costing (VC),...
QUESTION 5 Which statement is true regarding variable costing (VC)? A VC reported profit is influenced by the numbe...
QUESTION 5 Which statement is true regarding variable costing (VC)? A VC reported profit is influenced by the number of units sold and the number of units produced B.VC is a generally accepted accounting principle C. VC is not compatible with cost-volume-profit analysis D. VC is more useful than absorption costing for short-run decision making
Which of the following statements is true regarding variable costing? Multiple Choice It is a traditional...
Which of the following statements is true regarding variable costing? Multiple Choice It is a traditional costing approach. It makes it easier to manipulate earnings with changes in production levels. Only manufacturing costs that change in total with changes in production level are included in product costs. It treats overhead in the same manner as absorption costing. It is not permitted to be used for managerial reporting.
Which of the following statements is true of absorption costing? a. It is used only for...
Which of the following statements is true of absorption costing?a. It is used only for internal reporting purposes.b. It assigns all manufacturing costs to the product.c. It treats fixed selling overhead as a product cost.d. It treats fixed manufacturing overhead as a period cost.Determine the value of ending inventory under variable costing.a. $ 1,050,000b. $ 570,000c. $ 690,000d. $ 750,000Determine the cost of goods sold under absorption costing.a. $ 360,000b. $ 500,000c. $ 400,000d. $ 540,000
Sierra Company incurs the following costs to produce and sell a single product. Variable costs per...
Sierra Company incurs the following costs to produce and sell a single product. Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative expenses Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses EA GA GA GA $ 121,000 $ 305,000 During the last year, 30,250 units were produced and 24,500 units were sold. The Finished Goods inventory account at the end of the year shows a balance of $109,250 for the...
Sierra Company incurs the following costs to produce and sell a single product. AYN Variable costs...
Sierra Company incurs the following costs to produce and sell a single product. AYN Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative expenses Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses $ $ 59,000 290,000 During the last year, 29,500 units were produced and 24,250 units were sold. The Finished Goods inventory account at the end of the year shows a balance of $120,750 for the 5,250 unsold units....
Sierra Company incurs the following costs to produce and sell a single product. Variable costs per...
Sierra Company incurs the following costs to produce and sell a single product. Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative expenses Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses S S S S 12 9 3 S S 118.000 295,000 During the last year, 29.500 units were produced and 24,500 units were sold. The Finished Goods inventory account at the end of the year shows a balance of...
Sierra Company incurs the following costs to produce and sell a single product. $ Variable costs...
Sierra Company incurs the following costs to produce and sell a single product. $ Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative expenses Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses 11 6 3 6 $ $ $ 90,750 290,000 During the last year, 30,250 units were produced and 26,000 units were sold. The Finished Goods inventory account at the end of the year shows a balance of $85,000...
QUESTION 1 Which of the following is not true about the variable costing and absorption costing...
QUESTION 1 Which of the following is not true about the variable costing and absorption costing methods? Absorption costing treats fixed costs as period costs while variable costing treats it as a product cost. Absorption costing allocates all manufacturing costs as product costs while variable costing only uses direct manufacturing costs. Variable costing and absorption costing both treat selling and administrative costs as period costs. Variable costing is designed to capture only variable overhead costs while absorption costing's meant to...
22. Which of the following statements is (are) true? 1). An asset is a cost that...
22. Which of the following statements is (are) true? 1). An asset is a cost that will be matched with revenues in a future accounting period 2). Opportunity costs are recorded as intangible assets in the current accounting period A. Only (1) is true. B. Only (2) is true C. Both (1) and (2) are true23. Which of the following statements is (are) false? (1). In general, the term expense is used for managerial purposes, while the term cost refers external financial reports. (2). An opportunity cost...
Sierra Company incurs the following costs to produce and sell a single product. $ 10 $...
Sierra Company incurs the following costs to produce and sell a single product. $ 10 $ 9 Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative expenses Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses $ 93,750 $285,000 During the last year, 31,250 units were produced and 24,250 units were sold. The Finished Goods inventory account at the end of the year shows a balance of $154,000 for the 7,000...
QUESTION 5 Which statement is true regarding variable costing (VC)? A VC reported profit is influenced by the number of units sold and the number of units produced B.VC is a generally accepted accounting principle C. VC is not compatible with cost-volume-profit analysis D. VC is more useful than absorption costing for short-run decision making
Which of the following statements is true of absorption costing?a. It is used only for internal reporting purposes.b. It assigns all manufacturing costs to the product.c. It treats fixed selling overhead as a product cost.d. It treats fixed manufacturing overhead as a period cost.Determine the value of ending inventory under variable costing.a. $ 1,050,000b. $ 570,000c. $ 690,000d. $ 750,000Determine the cost of goods sold under absorption costing.a. $ 360,000b. $ 500,000c. $ 400,000d. $ 540,000
Sierra Company incurs the following costs to produce and sell a single product. Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative expenses Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses EA GA GA GA $ 121,000 $ 305,000 During the last year, 30,250 units were produced and 24,500 units were sold. The Finished Goods inventory account at the end of the year shows a balance of $109,250 for the...
Sierra Company incurs the following costs to produce and sell a single product. AYN Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative expenses Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses $ $ 59,000 290,000 During the last year, 29,500 units were produced and 24,250 units were sold. The Finished Goods inventory account at the end of the year shows a balance of $120,750 for the 5,250 unsold units....
Sierra Company incurs the following costs to produce and sell a single product. Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative expenses Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses S S S S 12 9 3 S S 118.000 295,000 During the last year, 29.500 units were produced and 24,500 units were sold. The Finished Goods inventory account at the end of the year shows a balance of...
Sierra Company incurs the following costs to produce and sell a single product. $ Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative expenses Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses 11 6 3 6 $ $ $ 90,750 290,000 During the last year, 30,250 units were produced and 26,000 units were sold. The Finished Goods inventory account at the end of the year shows a balance of $85,000...
QUESTION 1 Which of the following is not true about the variable costing and absorption costing methods? Absorption costing treats fixed costs as period costs while variable costing treats it as a product cost. Absorption costing allocates all manufacturing costs as product costs while variable costing only uses direct manufacturing costs. Variable costing and absorption costing both treat selling and administrative costs as period costs. Variable costing is designed to capture only variable overhead costs while absorption costing's meant to...
Sierra Company incurs the following costs to produce and sell a single product. $ 10 $ 9 Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative expenses Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses $ 93,750 $285,000 During the last year, 31,250 units were produced and 24,250 units were sold. The Finished Goods inventory account at the end of the year shows a balance of $154,000 for the 7,000...
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