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    Mas SW 09.28.2024

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    Paul Tadem

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    Mas SW 09.28.2024

    Uploaded by

    Paul Tadem
    1 views2 pages

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    MAS_SW_09.28.2024

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    1 views2 pages

    Mas SW 09.28.2024

    Uploaded by

    Paul Tadem

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    © All Rights Reserved
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    of 2

    INTEGRATED ACCOUNTING 1 (MANAGEMENT ADVISORY SERVICES)

    Seatwork 1

    Name: ___________________________________________________

    Read each question carefully and provide the answer. Remember to remain silent during the
    seeatwork to avoid disrupting other students.

    ITEMS 1 TO 7 ARE BASED ON THE FOLLOWING INFORMATION:

    Kukuys Corporation uses an absorption costing system for internal reporting purposes. At present,
    however, it is considering to use the variable costing system.

    Following are some data regarding Kukuys Corporation’s budgeted and actual operations for the
    Calendar year 2023:

    COSTS Budgeted Actual


    Materials P 12,600.00 11,700.00
    Labor 9,240.00 8,580.00
    Variable factory overhead 4,200.00 3,900.00
    Fixed factory overhead 5,320.00 5,000.00
    Variable selling expenses 8,400.00 7,500.00
    Fixed selling expenses 7,350.00 7,350.00
    Variable administrative expenses 2,100.00 1,875.00
    Fixed administrative expenses 3,150.00 3,187.50
    P 52,360.00 49,092.50

    Budgeted Actual
    (units) (units)
    Finished goods beginning inventory 280 280
    Production 1,120 1,040
    Sales 1,120 1,000

    The budgeted costs were computed based on the budgeted production and sales of 1,120 units, the
    company’s normal capacity level. Kukuys Corporation uses a predetermined factory overhead rate
    for applying manufacturing overhead costs to its product. The denominator level used in developing
    the predetermined rate is the firm’s normal capacity. Any over -or- underapplied factory overhead
    cost is closed to cost of goods sold at the end of the year.

    There are not work in process inventories at either the beginning or end of the year. The actual selling
    price was the same as the amount planned, P65 per unit.
    The previous year’s planned per unit manufacturing costs were the same as the current planned unit
    manufacturing cost. The beginning inventory of finished goods for absorption costing purposes was
    valued at such per unit manufacturing cost.

    Compute the following:


    1. Operating income under both the absorption and variable costing methods.
    2. The values of Kukuys actual ending finished goods inventory on the absorption and variable
    costing methods.
    3. Total fixed costs expenses this year on both absorption and variable costing methods.
    4. Actual manufacturing contribution margin for the year calculated on the variable costing
    basis
    5. Actual contribution margin for the year calculated on the variable costing basis
    6. The total variable costs expense currently by Kukuys on both the absorption and variable
    costing basis.
    7. The difference between Kukuys operating income calculated on the absorption costing basis
    and that on the variable costing basis.

    ITEMS 8 and 9 ARE BASED ON THE FOLLOWING INFORMATION:

    Akashi Corporation produces and sells a single product. In 2023, its first year operation, planned
    and actual production was 80,000 units. It sold 75,000 of these units for P15 per unit.

    Planned and actual costs in 2023 were as follows:


    Manufacturing Non-manufacturing
    Variable P 240,000 P 200,000
    Fixed 160,000 120,000

    8. Using absorption costing, the company’s operating income in 2023 would be:____
    9. Using variable costing, the company’s operating income in 2023 would be: _____

    10. If production is less than sales (in units), then absorption costing net income will generally
    be (Multiple choice).
    a. Greater than variable costing net income.
    b. Less than variable costing net income.
    c. Equal to variable costing net income.
    d. Less than expected.

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