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marginal and absorption calculation profit

Forums › FIA Forums › marginal and absorption calculation profit

  • This topic has 0 replies, 1 voice, and was last updated 8 years ago by Avatarmalinasir786.
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  • September 21, 2017 at 7:40 pm #408256
    Avatarmalinasir786
    Member
    • Topics: 1
    • Replies: 0
    • ☆

    A company has the following costs for its single product, based on planned production and sales of 50,000 units in a period:

    Prime cost per unit $5.20

    Productions overheads (all fixed) 2.80.

    Variable 0.65
    Fixed 1.70

    Actual production and sales in the period were:

    Production 46,000 units
    Sales 45,600 units
    Selling price $12:00

    Additional point :

    I) There was no finished stock at the beginning of the period .

    Ii) variable costs per unit and total fixed costs in the period were as planned or budgeted .

    Iii) variable non production overheads vary in total with the number of units sold.

    Required :

    A- prepare a profit statememt for the period using absorption costing technique

    B- calculate gross profit and contribution margin per unit

    C- calculate gross profit and contribution margin percentage

    D- calculate net profit with shortcut approach under marginal costing technique .

    Pls guys help me out with answers.

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