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Chan Manufacturing Company data for 20X7 follow:

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Variable and Absorption Costing;Chan Manufacturing Company data for 20X7 follow;Sales: 12,000 units at $17 each;Actual production 15,000 units;Expected volume of production 18,000 units;Manufacturing costs incurred;Variable $120,000;Fixed 63,000;Nonmanufacturing costs incurred;Variable $ 24,000;Fixed 18,000;1. Determine operating income for 20X7, assuming the firm uses the variable-costing approach to;product costing. (Do not prepare a statement.);2. Assume that there is no January 1, 20X7, inventory, no variances are allocated to inventory, and;the firm uses a "full absorption" approach to product costing. Compute (a) the cost assigned to;December 31, 20X7, inventory, and (b) operating income for the year ended December 31, 20X7.;(Do not prepare a statement.)

 

Paper#26644 | Written in 18-Jul-2015

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