Filetype Excel XLSX | Posted on 18 Aug 2022 | 3 years ago
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204x Filetype XLSX File size 0.96 MB Source: spa-febui.com
Sheet 1: Cover
| PT Cempaka | VMC/Unit | $17.14 | The following data are available for PT Kembang for the year ended December 31, 2020. |
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| Sales | $1,500,000 | FMC/Unit | $10.20 | |||||||||
| Sales: | 30,000 | $50.00 | ||||||||||
| Beginning Inventory | 0 | Expected and Actual Production: | 35,000 | |||||||||
| Produced | 35,000 | |||||||||||
| Ending | (5,000) | Manufacturing Costs Incurred: | ||||||||||
| Units Sold | 30,000 | Variable | $600,000 | $17.14 | ||||||||
| Fixed | $357,000 | $10.20 | ||||||||||
| A. | Variable Costing Income Statement: | |||||||||||
| Non-manufacturing Costs Incurred: | ||||||||||||
| Revenues | $1,500,000 | Variable | $129,800 | $3.71 | ||||||||
| COGS: | Fixed | $69,420 | $1.98 | |||||||||
| Beginning Inventory | 0 | Beginning Inventories | 0 | |||||||||
| Variable Manufacturing Cost | $600,000.00 | |||||||||||
| COGAFS | $600,000.00 | |||||||||||
| Ending Inventory | ($85,714.29) | |||||||||||
| Variable COGS | $514,285.71 | |||||||||||
| Variable Non-manufacturing Costs | $129,800.00 | |||||||||||
| Contribution Margin | $855,914.29 | |||||||||||
| Fixed Manufacturing Costs | $357,000.00 | |||||||||||
| Fixed Non-manufacturing Costs | $69,420.00 | |||||||||||
| Operating Income | $429,494.29 | |||||||||||
| B. | Absorption Costing Income Statement | |||||||||||
| Sales | $1,500,000 | |||||||||||
| COGS: | ||||||||||||
| Beginning Inventory | 0 | |||||||||||
| Variable Manufacturing Cost | $600,000.00 | |||||||||||
| Allocated Fixed Manufacturing Cost | $357,000.00 | |||||||||||
| COGAFS | $957,000.00 | |||||||||||
| Ending Inventory | -$136,714.29 | |||||||||||
| Adjustment for PVV | 0 | |||||||||||
| COGS | $820,285.71 | |||||||||||
| Gross Margin | $679,714.29 | |||||||||||
| Variable Non-manufacturing Cost | $129,800 | |||||||||||
| Fixed Non-manufacturing Cost | $69,420 | |||||||||||
| Operating Income | $480,494.29 | |||||||||||
| C. | Reconcile the difference (Using Formula 1) | |||||||||||
| Formula 1: | Absorption Costing Operating Income - Variable Costing Operating Income = Fixed Manufacturing Cost in Beg. Inventory Under Absorption Costing - Fixed Manufacturing Cost in Ending Inventory Under Absorption Costing |
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| Operating Income | ||||||||||||
| Absorption Costing | $480,494.29 | Why do variable costing and absorption costing report different operating income numbers? In general, if inventory increases during an accounting period, less operating income will be reported under variable costing than absorption costing. Conversely, if inventory decreases, more operating income will be reported under variable costing than absorption costing. The difference in reported operating income is due solely to (a) moving fixed manufacturing costs into inventories as inventories increase and (b) moving fixed manufacturing costs out of inventories as inventories decrease, under absorption costing. The difference between operating income under absorption costing and variable costing can be computed by formula 1, which focuses on fixed manufacturing costs in beginning inventory and ending inventory. | ||||||||||
| Variable Costing | $429,494.29 | Difference: | $51,000.00 | |||||||||
| Fixed Manufacturing Cost (Absorption Costing) |
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| Ending | $51,000.00 | |||||||||||
| Beginning | $0.00 | Difference: | $51,000.00 | |||||||||
| C. | Reconcile the difference (Using Formula 2) | |||||||||||
| Formula 2: | Absorption Costing Operating Income - Variable Costing Operating Income = Fixed Manufacturing Costs Inventoried in Units Produced Under Absorption Costing - Fixed Manufacturing Cost in COGS Under Absorption Costing |
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| Operating Income | ||||||||||||
| Absorption Costing | $480,494.29 | Fixed manufacturing costs in ending inventory are deferred to a future period under absorption costing. Therefore, Instead of focusing on fixed manufacturing costs in ending and beginning inventory (as in formula 1), we could alternatively look at fixed manufacturing costs in units produced and units sold. The latter approach (see formula 2) highlights how fixed manufacturing costs move between units produced and units sold during the fiscal year. | ||||||||||
| Variable Costing | $429,494.29 | Difference: | $51,000.00 | |||||||||
| Fixed Manufacturing Cost (Absorption Costing) |
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| Units Produced | $357,000.00 | |||||||||||
| COGS | $306,000.00 | Difference: | $51,000.00 | |||||||||
| Hot Dogs: | |||||||||
| Selling price per piece | $1.60 | ||||||||
| Variable cost per piece | $1.10 | ||||||||
| Contribution Margin | $0.50 | ||||||||
| Croquettes: | |||||||||
| Selling price per piece | $2.80 | ||||||||
| Variable cost per piece | $1.30 | ||||||||
| Contribution Margin | $1.50 | ||||||||
| Total fixed costs | $12,000 | ||||||||
| The sales mix was three pieces of Hot Dogs and one piece of Croquettes | |||||||||
| A. | Quantity of BEP = | FC | $12,000 | ||||||
| CM/Bundle | $3.00 | ||||||||
| Q BEP = | 4,000.00 | Bundles, which means 12.000 pieces of Hot Dogs and 4.000 pieces of Croquettes | |||||||
| B. | Hot Dogs (3) | Croquettes (1) | Total | ||||||
| Expected Sales | 22,500 | 7,500 | 30,000 | Units | |||||
| Revenue | $36,000.00 | $21,000.00 | $57,000 | ||||||
| Variable Cost | $24,750.00 | $9,750.00 | $34,500 | ||||||
| Contribution Margin | $11,250.00 | $11,250.00 | $22,500 | ||||||
| Fixed Cost | $12,000 | ||||||||
| Operating Income | $10,500 | ||||||||
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