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absorption costing

Forums › ACCA Forums › ACCA MA Management Accounting Forums › absorption costing

  • This topic has 3 replies, 2 voices, and was last updated 2 months ago by John Moffat.
Viewing 4 posts - 1 through 4 (of 4 total)
  • Author
    Posts
  • April 6, 2022 at 12:13 pm #652783
    zainrajput
    • Topics: 7
    • Replies: 4
    • ☆

    budgeted production units 13000
    actual prod units 12000
    actual sales 11500
    profit under marginal costing 80000
    foar 6
    what is the profit under absorption costing?

    my answer is 12000-11500=500×6=3000
    3000+80000=83000
    but i am confused in the point that is inventory levels increasing or decreasing?
    the actual prod units were 12000 and sales were 11500 so is the remaining 500 increase the inventory or decrease it? also did i calculate it the right way?

    April 6, 2022 at 3:17 pm #652793
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 49583
    • ☆☆☆☆☆

    In future you must ask in the Ask the Tutor Forum if you want me to answer – this forum is for students to help each other.

    If a business produces more than they sell, then the difference must be increasing the inventory.

    Therefore your answer of 83,000 is correct.

    April 6, 2022 at 3:48 pm #652801
    zainrajput
    • Topics: 7
    • Replies: 4
    • ☆

    thankyou 🙂

    April 7, 2022 at 10:31 am #652826
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 49583
    • ☆☆☆☆☆

    You are welcome.

  • Author
    Posts
Viewing 4 posts - 1 through 4 (of 4 total)
  • The topic ‘absorption costing’ is closed to new replies.

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