Maurice Tutor

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    Argosy University/ Phoniex University/
    Nov-2005 - Oct-2011

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    Phoniex University
    Oct-2001 - Nov-2016

Category > Accounting Posted 23 Jul 2017 My Price 7.00

self-assembly

Bookcases Ltd produces packs of book shelves for self-assembly. The budgeted selling price and costs are as follows:

Budget for one unit:

£

Selling price

60

Direct materials

36

Direct labour

5

Variable production overhead Total variable cost

3 44

The fixed production overhead cost for one month is budgeted as £40,000. The budgeted production volume is 5,000 units per month. In the month of February sales are lower than expected. At the start of March there are 200 unsold units in stock. Production is maintained at 5,000 units in the month of March.

Required

Calculate the profit for March under (a) absorption costing and (b) marginal costing for each of the following situations:

(1) Situation A: sales in March are 4,700 units

(2) Situation B: sales in March are 5,100 units

Answers

Maurice Tutor
(5)
Status NEW Posted 23 Jul 2017 09:07 PM My Price 7.00

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