Problem:
Use any numbers in this problem:
Clifton Company, which has only one product, has provided the following data concerning its most recent month of operations:
Selling price
Units in beginning inventory
Units produced
Units sold
Units in ending inventory
Variable costs per unit:
Direct materials
Direct labor
Variable manufacturing overhead
Variable selling and administrative
Fixed costs:
Fixed manufacturing overhead
Fixed selling and administrative
a. The total contribution margin for the month under the variable costing approach is:
b. The total gross margin for the month under the absorption costing approach is:
c. When production exceeds sales, the net operating income reported under absorption costing generally will be:
c. When sales exceed production, the net operating income reported under variable costing generally will be: