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    Absorption versus Variable Costing - Collegiate Sporting Goods

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    Information taken from Collegiate Sporting Goods Company's records for the most recent year is as follows:

    Direct material used $272,000
    Direct labor $128,000
    Variable manufacturing overhead $60,000
    Fixed manufacturing overhead $100,000
    Variable selling and administrative costs $56,000
    Fixed selling and administrative costs $29,600

    1. Assuming the company uses absorption costing, compute the inventoriable costs for the year.

    2. Compute the year's inventoriable costs using variable costing.

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    Solution Summary

    The solution computes the year's inventoriable costs using variable costing.