Purchase Solution

Bianca Bicycle Company: Variable Costing and Absorption Costing

Not what you're looking for?

Ask Custom Question

Bianca Bicycle Company manufactures mountain bikes with a variable cost of $208. The bicycles sell for $390 each. Budgeted fixed manufacturing overhead for the most recent year was $3,080,000. Planned and actual production for the year were the same.

1. Production 20,000 units
Sales 23,400 units
2. Production 10,800 units
Sales 10,800 units
3. Production 11,000 units
Sales 9,400 units

Required:

State whether income is higher under variable or absorption costing and the amount of the difference in reported income under the two methods. Treat each condition as an independent case. (Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.)

Method Amount
1. (Click to select)Same under bothVariable costingAbsorption costing $
2. (Click to select)Variable costingAbsorption costingSame under both $
3. (Click to select)Variable costingSame under bothAbsorption costing $

Purchase this Solution
Solution Summary

The following posting helps with problems involving variable costing and absorption costing.

Solution Preview

Solution is provided in a separate Excel file attached. It contains the following parts.

1 Data used in the problem Case 1 Case ...

Purchase this Solution
Free BrainMass Quizzes
SWOT

This quiz will test your understanding of the SWOT analysis, including terms, concepts, uses, advantages, and process.

Learning Lean

This quiz will help you understand the basic concepts of Lean.

Lean your Process

This quiz will help you understand the basic concepts of Lean.

Organizational Leadership Quiz

This quiz prepares a person to do well when it comes to studying organizational leadership in their studies.

MS Word 2010-Tricky Features

These questions are based on features of the previous word versions that were easy to figure out, but now seem more hidden to me.

View More Free Quizzes
Related BrainMass Solutions

  • Taylor Chains absorption costing flexible budget

    How much manufacturing overhead will appear on Taylors' income statement f the company uses (1)absorption costing or (2) variable costing?

  • EEC: Financial Management

    Absorption costing is basically of three types: Job order costing used in printing, furniture manufacturing and bicycle manufacturing where costs are assigned to the product in batches and lots.

  • Absorption vs. Variable Costing

    607537 Absorption vs. Variable Costing Explain the differences between absorption costing and variable costing. Explain, with the help of an example, how a company could use a variable costing system, as well as an absorption costing system.

  • Bittman Company produces picture frames. During its first ye

    Explain the difference in the net income determined under the absorption and variable costing methods. Bittman Company produces picture frames.

  • Clayton Company: Variable costing vs absorption costing

    436060 Clayton Company: Variable costing vs absorption costing 4. Clayton Company produces a single product. Last year, the company's variable production costs totaled $8,000 and its fixed manufacturing overhead costs totaled $4,800.

  • Reconcile the variable and absorption costing

    Reconcile the variable costing and absorption costing net operation income figures.CPA was correct because according to the absorption method the company earned profit in first month.

  • Houston Company: Absorption and Variable Costing Net Income

    315067 Houston Company: Absorption and Variable Costing Net Income Houston Company has per-unit fixed and variable manufacturing costs of $40 and $15, respectively. Variable selling and administrative costs are $9 per unit.

  • Calculating Product Cost Using Variable and Absorption Costing

    Statement of unit cost analysis under Variable and absorption costing 3. Income statement under Absorption costing 4. Income statement under Variable costing 5.

  • CVP Analysis

    253282 Absorption and Variable costing, CVP Analysis, break even Brownstone Company began operations on January 1 to produce a single product. It used a standard absorption costing system with a planned production volume of 100,000 units.

View More Related Solutions