Advanced Company reports the following information for the current year. All beg

Question

Advanced Company reports the following information for the current year. All beginning inventory amounts equaled $0 this year.

33.Given Advanced Company's data, compute cost of finished goods in inventory under absorption costing.

$230,000

$427,500

$285,000

$345,000

$712,500

34.Given Advanced Company's data, compute cost of finished goods in inventory under variable costing.

$712,500

$345,000

$230,000

$427,500

$285,000

Advanced Company reports the following information for the current year. All beginning inventory amounts equaled $0 this year.

Explanation / Answer

33./

COST PER UNIT UNDER ABSORPTION COSTING.

34./

COST PER UNIT UNDER VARIABLE COSTING.

DIRECT MATERIAL $9 DIRECT LABOUR $11 VARIABLE OVERHEAD ($75000 / 25000) $3 FIXED OVERHEAD ($137500 / 25000) $5.50 TOTAL COST PER UNIT $28.50 TOTAL CLOSING STOCK UNIT (25000 - 15000) 10000 VALUE OF CLOSING STOCK (10000 * $28.50) $285000

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