Beans manufactures a single product, details of which are as follows. Per unit $ Selling price 700 Direct Materials 90 Direct labour 120 Variable overheads 200 Annual...

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Accounting

Beans manufactures a single product, details of which are asfollows.
Per unit
$
Selling price
700
Direct Materials
90
Direct labour
120
Variable overheads
200
Annual fixed production overheads are budgeted to be $10 millionand the company expects to produce 200,000 units each year.Overheads are absorbed on a per unit basis.
Fixed operational expenses for the quarter are as follows
·         Sellingcosts $400,000
·         Administrativecosts $1,500,000
·         Distributioncosts $600,000
Actual stock data for quarter of 2020 are given below.
January – March
Sales
48,000
Production
42,000
Closing stock
3,000
Required-
a.       CalculateOpening stock.
b.      Prepare a MarginalCosting Statement.
c.       Prepare anAbsorption Costing Statement.
d.      Reconcile profitfigures from both statements.

Answer & Explanation Solved by verified expert

3.9 Ratings (749 Votes)

a Calculation of Opening stock Opening StockSalesProductionclosing stock 48000420003000 9000 units b Statement Of Marginal Cost statement Particulars Amount in Amount in Sales48000 units700 A 33600000 Less Cost of Production B Direct material4200090 3780000 Direct Labour42000120 5040000 Variable Overheads42000200 8400000 17220000 AddOpening Stock 9000units ValueNo of See Answer

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Per unit	$
Selling price	700
Direct Materials	90
Direct labour	120
Variable overheads	200

	January – March
Sales	48,000
Production	42,000
Closing stock	3,000