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Production 5,500 units Sales 5,000 units@₹ 2.40 per unit Variable Manufacturing Costs 1.20 per unit Fixed Manufacturing Costs * 2,860 Selling expenses ₹ 1,300 of which ₹400 is variable. . From the information given below prepare statement under Absorption Costing and Marginal Costing?
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Production 5,500 units Sales 5,000 units@₹ 2.40 per unit Variable Manu...
Statement under Absorption Costing:
- Absorption costing is a costing method that includes all manufacturing costs, both fixed and variable, in the cost of a product.
- Under absorption costing, fixed manufacturing costs are allocated to each unit produced.
- The statement under absorption costing would include both variable and fixed manufacturing costs in the cost of production.
Calculation of Cost of Production:
- Variable manufacturing costs per unit: ₹1.20
- Fixed manufacturing costs: ₹2,860
- Total manufacturing costs per unit: Variable manufacturing costs per unit + (Fixed manufacturing costs / Number of units produced)
- Total manufacturing costs per unit: ₹1.20 + (₹2,860 / 5,500)
- Total manufacturing costs per unit: ₹1.20 + ₹0.52 = ₹1.72
Statement under Marginal Costing:
- Marginal costing is a costing method that considers only variable manufacturing costs in the cost of a product.
- Under marginal costing, fixed manufacturing costs are treated as period costs and are not allocated to each unit produced.
- The statement under marginal costing would include only variable manufacturing costs in the cost of production.
Calculation of Cost of Production:
- Variable manufacturing costs per unit: ₹1.20
Statement under Absorption Costing:
- Sales: 5,000 units @ ₹2.40 per unit
- Total sales revenue: Number of units sold * Selling price per unit
- Total sales revenue: 5,000 * ₹2.40 = ₹12,000
- Cost of production: Number of units produced * Total manufacturing costs per unit
- Cost of production: 5,500 * ₹1.72 = ₹9,460
- Gross profit: Total sales revenue - Cost of production
- Gross profit: ₹12,000 - ₹9,460 = ₹2,540
- Selling expenses: ₹1,300 of which ₹400 is variable
- Contribution margin: Total sales revenue - Variable manufacturing costs - Variable selling expenses
- Contribution margin: ₹12,000 - (5,000 * ₹1.20) - ₹400 = ₹6,200
- Net profit: Contribution margin - Fixed manufacturing costs - Fixed selling expenses
- Net profit: ₹6,200 - ₹2,860 - (₹1,300 - ₹400) = ₹2,540
Statement under Marginal Costing:
- Sales: 5,000 units @ ₹2.40 per unit
- Total sales revenue: Number of units sold * Selling price per unit
- Total sales revenue: 5,000 * ₹2.40 = ₹12,000
- Variable manufacturing costs: Number of units sold * Variable manufacturing costs per unit
- Variable manufacturing costs: 5,000 * ₹1.20 = ₹6,000
- Contribution margin: Total sales revenue - Variable manufacturing costs
- Contribution margin: ₹12,000 - ₹6,000 = ₹6,000
- Fixed manufacturing costs: ₹2,860
- Fixed selling expenses: ₹1,300 - ₹400 = ₹900
- Net profit: Contribution margin - Fixed manufacturing costs - Fixed selling expenses
- Net profit: ₹6,000 - ₹2,860 - ₹900 = ₹2,240
- Absorption costing is a costing method that includes all manufacturing costs, both fixed and variable, in the cost of a product.
- Under absorption costing, fixed manufacturing costs are allocated to each unit produced.
- The statement under absorption costing would include both variable and fixed manufacturing costs in the cost of production.
Calculation of Cost of Production:
- Variable manufacturing costs per unit: ₹1.20
- Fixed manufacturing costs: ₹2,860
- Total manufacturing costs per unit: Variable manufacturing costs per unit + (Fixed manufacturing costs / Number of units produced)
- Total manufacturing costs per unit: ₹1.20 + (₹2,860 / 5,500)
- Total manufacturing costs per unit: ₹1.20 + ₹0.52 = ₹1.72
Statement under Marginal Costing:
- Marginal costing is a costing method that considers only variable manufacturing costs in the cost of a product.
- Under marginal costing, fixed manufacturing costs are treated as period costs and are not allocated to each unit produced.
- The statement under marginal costing would include only variable manufacturing costs in the cost of production.
Calculation of Cost of Production:
- Variable manufacturing costs per unit: ₹1.20
Statement under Absorption Costing:
- Sales: 5,000 units @ ₹2.40 per unit
- Total sales revenue: Number of units sold * Selling price per unit
- Total sales revenue: 5,000 * ₹2.40 = ₹12,000
- Cost of production: Number of units produced * Total manufacturing costs per unit
- Cost of production: 5,500 * ₹1.72 = ₹9,460
- Gross profit: Total sales revenue - Cost of production
- Gross profit: ₹12,000 - ₹9,460 = ₹2,540
- Selling expenses: ₹1,300 of which ₹400 is variable
- Contribution margin: Total sales revenue - Variable manufacturing costs - Variable selling expenses
- Contribution margin: ₹12,000 - (5,000 * ₹1.20) - ₹400 = ₹6,200
- Net profit: Contribution margin - Fixed manufacturing costs - Fixed selling expenses
- Net profit: ₹6,200 - ₹2,860 - (₹1,300 - ₹400) = ₹2,540
Statement under Marginal Costing:
- Sales: 5,000 units @ ₹2.40 per unit
- Total sales revenue: Number of units sold * Selling price per unit
- Total sales revenue: 5,000 * ₹2.40 = ₹12,000
- Variable manufacturing costs: Number of units sold * Variable manufacturing costs per unit
- Variable manufacturing costs: 5,000 * ₹1.20 = ₹6,000
- Contribution margin: Total sales revenue - Variable manufacturing costs
- Contribution margin: ₹12,000 - ₹6,000 = ₹6,000
- Fixed manufacturing costs: ₹2,860
- Fixed selling expenses: ₹1,300 - ₹400 = ₹900
- Net profit: Contribution margin - Fixed manufacturing costs - Fixed selling expenses
- Net profit: ₹6,000 - ₹2,860 - ₹900 = ₹2,240
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Production 5,500 units Sales 5,000 units@₹ 2.40 per unit Variable Manufacturing Costs 1.20 per unit Fixed Manufacturing Costs * 2,860 Selling expenses ₹ 1,300 of which ₹400 is variable. . From the information given below prepare statement under Absorption Costing and Marginal Costing?
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Production 5,500 units Sales 5,000 units@₹ 2.40 per unit Variable Manufacturing Costs 1.20 per unit Fixed Manufacturing Costs * 2,860 Selling expenses ₹ 1,300 of which ₹400 is variable. . From the information given below prepare statement under Absorption Costing and Marginal Costing? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about Production 5,500 units Sales 5,000 units@₹ 2.40 per unit Variable Manufacturing Costs 1.20 per unit Fixed Manufacturing Costs * 2,860 Selling expenses ₹ 1,300 of which ₹400 is variable. . From the information given below prepare statement under Absorption Costing and Marginal Costing? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Production 5,500 units Sales 5,000 units@₹ 2.40 per unit Variable Manufacturing Costs 1.20 per unit Fixed Manufacturing Costs * 2,860 Selling expenses ₹ 1,300 of which ₹400 is variable. . From the information given below prepare statement under Absorption Costing and Marginal Costing?.
Production 5,500 units Sales 5,000 units@₹ 2.40 per unit Variable Manufacturing Costs 1.20 per unit Fixed Manufacturing Costs * 2,860 Selling expenses ₹ 1,300 of which ₹400 is variable. . From the information given below prepare statement under Absorption Costing and Marginal Costing? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about Production 5,500 units Sales 5,000 units@₹ 2.40 per unit Variable Manufacturing Costs 1.20 per unit Fixed Manufacturing Costs * 2,860 Selling expenses ₹ 1,300 of which ₹400 is variable. . From the information given below prepare statement under Absorption Costing and Marginal Costing? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Production 5,500 units Sales 5,000 units@₹ 2.40 per unit Variable Manufacturing Costs 1.20 per unit Fixed Manufacturing Costs * 2,860 Selling expenses ₹ 1,300 of which ₹400 is variable. . From the information given below prepare statement under Absorption Costing and Marginal Costing?.
Solutions for Production 5,500 units Sales 5,000 units@₹ 2.40 per unit Variable Manufacturing Costs 1.20 per unit Fixed Manufacturing Costs * 2,860 Selling expenses ₹ 1,300 of which ₹400 is variable. . From the information given below prepare statement under Absorption Costing and Marginal Costing? in English & in Hindi are available as part of our courses for B Com.
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Production 5,500 units Sales 5,000 units@₹ 2.40 per unit Variable Manufacturing Costs 1.20 per unit Fixed Manufacturing Costs * 2,860 Selling expenses ₹ 1,300 of which ₹400 is variable. . From the information given below prepare statement under Absorption Costing and Marginal Costing?, a detailed solution for Production 5,500 units Sales 5,000 units@₹ 2.40 per unit Variable Manufacturing Costs 1.20 per unit Fixed Manufacturing Costs * 2,860 Selling expenses ₹ 1,300 of which ₹400 is variable. . From the information given below prepare statement under Absorption Costing and Marginal Costing? has been provided alongside types of Production 5,500 units Sales 5,000 units@₹ 2.40 per unit Variable Manufacturing Costs 1.20 per unit Fixed Manufacturing Costs * 2,860 Selling expenses ₹ 1,300 of which ₹400 is variable. . From the information given below prepare statement under Absorption Costing and Marginal Costing? theory, EduRev gives you an
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