Inventory Cost using Variable & Absorption Costing
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The following production data came from the records of LeShaq Athletic Enterprises for the year ended December 31, 2011
matierals 480000
labor 260000
variable factory overhead 44000
fixed factory overhead 36800
During the year 40,000 units where manufactured but only 35,000 units where sold. Determine the effect on incentory valuation by computing the following
1. total inventoriable cost annd the cost of the 35,000 units sold and the 5000 units in
ending inventory, using varible costing
2. total invnentorable cost and the cost of the 35,000 untis sold ad the 5000 units
in the ending inventory using absorption costing
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Solution Summary
The solution computes Inventory Cost using Variable & Absorption Costing in a given example.
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1. Variable Costing
a) Total Inventoriable Cost = 480000+260000+44000 = $784,000
b) Cost of ...
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