PRODUCTION = SALES

Nobita Company makes Doraemon laptop tables that sells for P250 each. The company's annual production
and sales level is 120,000 laptop tables. In addition to P4,305,000 fixed manufacturing overhead and
P1,590,500 fixed administrative expenses, the following per unit costs have bee determined for each laptop tables;
Direct Material 60
Direct Labor 30
Variable Manufacturing Overhead 8
Variable Selling Expense 22
Total Variable Cost per unit 120

ABSORPTION COSTING VARIABLE COSTING

Sales 30000000 Sales
Cost of Goods Sold: Variable Costs:
Material -7200000 Material
Labor -3600000 Labor
V - FOH -960000 V - FOH
F - FOH -4305000 V - S&A
Gross Profit 13935000 Contribution Margin
Operating Expense: Fixed Costs:
F - S&A -1590500 F - FOH
V - S&A -2640000 F - S&A
Net Income 9704500 Net Income

PRODUCTION > SALES

[ Walang beg. Inv pero may ending inv. Kasi mas malaki 'yung naproduce than naibenta.]

Nobita Company makes Doraemon laptop tables that sells for P250 each. The company's annual production
is 120,000 laptop tables. 100,000 tables were sold. In addition to P4,305,000 fixed manufacturing overhead and
P1,590,500 fixed administrative expenses, the following per-unit costs have been determined for each laptop table.
Direct Material 60
Direct Labor 30
Variable Manufacturing Overhead 8
Variable Selling Expense 22
Total Variable Cost per unit 120

ABSORPTION COSTING VARIABLE COSTING

Sales 25000000 Sales
Cost of Goods Sold: Variable Costs:
Material -6000000 Material
Labor -3000000 Labor
V - FOH -800000 V - FOH
 F - FOH -3587500 V - S&A
Gross Profit 11612500 Contribution Margin
Operating Expense: Fixed Costs:
F - S&A -1590500 F - FOH
V - S&A -2200000 F - S&A
Net Income 7822000 Net Income

PRODUCTION < SALES

[Mas mataas ang sales sa production kasi may natira ka last term which is magiging Beg. Inv mo 'yon ngayon.]

Nobita Company makes Doraemon laptop tables that sells for P250 each. The company's annual production level is
120,000 laptop tables. There were 50,000 unsold laptop table from last year. 140,000 tables were sold this year.
In addition to P4,305,000 fixed manufacturing overhead and P1,590,500 fixed administrative expenses, the following
costs have been determined for each laptop table:
Direct Material 60
Direct Labor 30
Variable Manufacturing Overhead 8
Variable Selling Expense 22
Total Variable Cost per unit 120

ABSORPTION COSTING VARIABLE COSTING

Sales 35000000 Sales
Cost of Goods Sold: Variable Costs:
Material -8400000 Material
Labor -4200000 Labor
V - FOH -1120000 V - FOH
F - FOH -5022500 V - S&A
Gross Profit 16257500 Contribution Margin
Operating Expense: Fixed Costs:
F - S&A -1590500 F - FOH
V - S&A -3080000 F - S&A
Net Income 11587000 Net Income
pany's annual production
ing overhead and
ermined for each laptop tables;

ABSORPTION VARIABLE
30000000 30000000 30000000

-7200000 -7200000 -7200000

-3600000 -3600000 -3600000
-960000 -960000 -960000
-2640000 -4305000 -2640000
15600000 13935000 15600000
operating expense: fixed costs:
-4305000 -1590500 -4305000
-1590500 -2640000 -1590500
9704500 9704500 9704500

pany's annual production

manufacturing overhead and
etermined for each laptop table.

25000000

-6000000
-3000000
-800000
 -2200000 2200000
13000000

-4305000
-1590500
7104500

g Beg. Inv mo 'yon ngayon.]

pany's annual production level is

00 tables were sold this year.
inistrative expenses, the following per-unit

35000000 35000000

-8400000 8400000
-4200000
-1120000
-3080000 3080000
18200000

-4305000
-1590500
12304500
Multiple Choice Book.
Manga, Inc., manufactured 700 units last year. The ending inventory consisted of 100 units. There was no beginning inventory
Variable manufacturing cost were P6.00 per unit and fixed manufacturing costs were P2.00 per unit. What would be the chang
amount of ending inventory if variable costing was used instead of absorption costing?
Answer: P200 Decrease

Absorption: 100 Units x (6.00 + 2.00) = 800 800

-600
Variable: 100 Units x P6 = 600 200

Variable production costs are P12 per unit and variable selling and administrative expenses are P3 per unit. Fixed manufacturi
and fixed selling and administrative expenses total P40,000. Assuming a beginning inventory of zero, production of 4,000 units
and sales of 3,600 units, the peso value of the ending inventory under variable costing would be:
Answer: P4,800

4,000 unit produced - 3,600 units sold = 400 ending inventory

400 ending inventory x P12 per unit = 4,800

Sales
Variable Expeneses
Direct Materials
Direct Labor
V FOH
VS&A

Contribution Margin
Fixed Expenses
F FOH
FS&A
Net Income
Ending Inventories 27,000
Beginning Inventories -22,000
5,000
Fixed Manufacturing Overhead 3
15000
Income using V costing 40,000
Income Using A costing 55,000

Sales
Cost of goods sold
Direct Materials
Direct Labor
V FOH
F FOH

Gross Profit
Operating Expense
V S& A
FS&A
Net Income

Variable Costing
Sales
Variable Expenses
V Production
VS&A
Contribution Margin
Fixed Expenses
F Production
FS&A
Net Income
Absorption Costing
Variable Costing
re was no beginning inventory.
unit. What would be the change in the peso

P3 per unit. Fixed manufacturing overhead totals P36,000

ero, production of 4,000 units

1,900,000 1900000

228,000 228000
475,000
57,000
38,000
-798,000
1,102,000

-500,000
-600,000
2,000
980,000

147,000
245,000
98,000
196,000
-686,000
294,000

-196,000
-50,000
48,000

Absorption Costing
240,000 Sales 240,000
Cost of goods sold
-80,000 V Production -80,000
-20,000 F Production -40,000
140,000 Gross Profit 120,000
Operating Expenses
-48,000 V S& A -20,000
-36,000 FS&A -36,000
56,000 Net Income 64,000
 90,000 Total FOH 150,000
-85,500 Production 100,000
4,500 1.5
1.5
3000
https://www.studocu.com/ph/document/university-of-the-east-philippines/accountancy/multiple-choice-questions/1113026
ple-choice-questions/11130261
Sales 810,000 810000
Variable Expenses
DM -157,500 -157500
DL -112,500 -112500
V FOH -45,000 -45000
VS&A -54,000 -54000
Contribution Margin 441,000 441000
Fixed Expenses
F FOH -100,000 -100000
FS&A -70,000 -70000
Net Income 271,000 271000

Unit cost under Absorption Costing Direct Costing / Variable Costing

DM 1.5 Sales 560,000 560000
DL 1 Variable Expenses
V FOH 0.5 DM -120,000
F FOH 1.5 DL -80,000
4.5 V FOH -40,000
V SA -40,000
Contribution Margin 280,000
Fixed Expenses
F FOH -150,000
F SA -80,000
Net Income 50,000
Absorption Costing Variable Costing
DM 1 DM 1
DL 0.8 DL 0.8
V FOH 0.4 V FOH 0.4
F FOH 0.5
Unit Cost 2.7 Unit Costs 2.2

DM + DL 700,000
Other V FOH 100,000
Depreciation 80,000
Other F FOH 18,000
898,000

Direct Costing / Variable Costing Absorption Costing

DM 87,500 DM 87,500
DL 137,500 DL 137,500
V FOH 93,750 VFOH 93,750
FFOH 81,250
FG 318,750 FG 400,000