ACCT 505 help A Guide to career/uophelp.com ACCT 505 help A Guide to career/uophelp.com | Page 33

Fixed manufacturing overhead $275,000
Fixed selling and admin $200,000
Required:
Compute the cost of a single unit of product under both the absorption
costing and variable costing approaches.
Prepare an income statement for the year using absorption costing.
Prepare an income statement for the year using variable costing. (Points :
30)
Question 1. Question : (TCO A) The variable portion of advertising
costs is a
Student Answer: Conversion YES... Period NO.
Conversion YES .... Period YES.
Conversion NO.... Period NO.
Conversion NO.... Period YES.
Question 2. Question : (TCO A) A cost incurred in the past that is not
relevant to any current decision is classified as a(n)
Student Answer: period cost.
incremental cost.
opportunity cost.
None of the above
Question 3. Question : (TCO A) Property taxes on a company's factory
building would be classified as a(n)
Student Answer: variable cost.