Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. dabwiso limited uses a standard costing system. th

Dabwiso Limited uses a standard costing system. The standard cost per unit of Product...

80.2K

Verified Solution

Question

Accounting

Dabwiso Limited uses a standard costing system. The standard cost per unit of
Product D is as follows:
K
Direct material 2,500
Direct labour 1,200
Production overheads: Variable 600
Fixed 500
Standard production cost 4,800
Standard selling price 7,500
The standard fixed production overhead absorption rate was based on a budgeted
activity of 10,000 units.
During Period 4, Production was 10,000 units as planned but sales were only 8,000 units. There was a total fixed production overhead variance of K500000 adverse. All units were sold at K7,500 each.
There were no opening inventory at the beginning of the period.
Other costs incurred during the period were in relation to selling and distribution, and administration. These were as follows:
Variable Fixed
Selling and distribution 20% of sales K3000000
Administration K5000000
Required:
(a) Prepare operating Profit statement for Period 4 using:
(i) Absorption costing
(ii) Marginal
(b) Prepare a reconciliation of the difference between the Profit/Loss under absorption costing and under marginal costing and explain the reason for the difference.

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

7-31 Consider the following LP problem: Maximize profit=5X+6Y subject to2X+Y≤120, 2X+3Y≤240X,Y≥0 What is the optimal solution to this...

Basic Math
Q

Solve the differential equation y''+y'-2y=3, y(0)=2, y'(0) = -1

Advance Math
Q

Photovoltaic (PV) arrays have become very popular in on-grid and off-grid systems due to their simplicity,...

Electrical Engineering
Q

Fiona is going to jog once around the block she lives on. The block is...

Basic Math
Q

Evaluate E Z 01 02 n n for z 0 63 0 0 81 0...

Statistics
Q

Is the following matrix invertible Select the correct answer below Yes the matrix is invertible...

Calculus
Q

In Problems I through 4 you given four sequenes of please do 2 things First...

Algebra
Q

25 4 points Melissa s dinner serves desserts One serving of ice cream and 2...

Algebra
Q

What are the ramifications of poor planning, budgeting and forecasting? Give an example of what...

Accounting
Q

On January 1,2023, The Pronghorn Company received a 4-year promissory note that had a face...

Accounting
Q

Calculate the companied break even point in sales dollars

Accounting
Q

Following are figures representing the number of stocks making new highs and new lows for...

Finance