Operating Income Under Absorption Versus Variable Costing

Related BrainMass Solutions

• Clayton Company: Variable costing vs absorption costing

  B) the net operating income under absorption costing for the year will be $480 lower than net operating income under variable costing.

• Preparing Variable and Absorption Costing Income Statements

  Is operating income higher under absorption costing or variable costing in June? In July?

• Variable and Absorption Costing

  225070 Variable versus Absorption Costing Prepare income statements under variable and absorption costing for the year ended December 31, 2007.

• Absorption Income vs Contribution Margin Income

  Therefore, the value of stock under absorption costing is more than the value of the stock under variable costing. If the production is greater than sales, the net income under absorption costing is more than the net income under variable costing.

• Variable and absorption costing

  134989 Variable and absorption costing: explaining operating-income differences Variable and absorption costing, explaining operating-income differences: Nascar Motors assembles and sells motor vehicles and uses standard costing.

• Income statements using variable and absorption costing

  Percentage terms Under absorption costing the operating income = 1,497,900/6,555,000=22.9% Under variable costing the operating income = 1,650,000/6,555,000= 25.2% Explain the difference in operating income between the two methods.

• Clifton Company, which has only one product, the total contribution margin for the month under the variable costing, Income statement under Variable costing for showing contribution margin & net operating income.

  parts. 1 Data used in the problem 2 Statement of unit cost analysis under Variable and absorption costing. 3 Income statement under Absorption costing for showing contribution margin & net operating income. 4 Income statement under Variable

• Absorption Costing

  The net operating income under absorption costing will be higher by 1,800 (since some fixed manufacturing cost in not expensed but included in the ending inventory) The net operating income under absorption costing will be 82,700+1,800=84,500 b.

• Variable versus absorption costing

  Prepare income statements under variable costing for the year ended December 31, 2004. Show all work.