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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.

Use any numbers in this problem:
Clifton Company, which has only one product, has provided the following data concerning its most recent month of operations:

Selling price

Units in beginning inventory
Units produced
Units sold
Units in ending inventory

Variable costs per unit:
Direct materials
Direct labor
Variable manufacturing overhead
Variable selling and administrative

Fixed costs:
Fixed manufacturing overhead
Fixed selling and administrative

a. The total contribution margin for the month under the variable costing approach is:

b. The total gross margin for the month under the absorption costing approach is:

c. When production exceeds sales, the net operating income reported under absorption costing generally will be:

c. When sales exceed production, the net operating income reported under variable costing generally will be:

Solution Preview

Dear student ,

Solution to your problem is developed on the basis of assumed data and provided herewith in a separate excel file in the ...

Solution Summary

Solution to your problem is developed on the basis of assumed data and provided herewith in a separate excel file in the following 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 costing for showing contribution margin & net operating income.

5 Notes for conceptual background.

6 Reconciliation of Variable and Absorption costing:

$2.19