It uses absorption costing based on standard costs and reports the following data for 2017: There are no price, spending, or efficiency variances

Magic Me is a manufacturer of magic kits. It uses absorption costing based on standard costs and reports the following data for 2017: There are no price, spending, or efficiency variances. Actual operating costs equal budgeted operating costs. The production-volume variance is written off to cost of goods sold. For each choice of denominator level, the budgeted production cost per unit is also the cost per unit of beginning inventory Q.What is the production-volume variance in 2017 when the denominator level is (a) theoretical capacity, (b) practical capacity, and (c) normal capacity utilization? Transcribed Image Text: Home
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B
300,000 units
279,070 units
232,558 units
50 per unit
40,000 units
240,000 units
260,000 units
10 per unit
$3,000,000
10 Total budgeted operating (non-manuf.) costs (all fixed) S 500,000|
1 Theoretical capacity
2 Practical capacity
3 Normal capacity utilization
4 Selling price
5 Beginning inventory
6 Production
7 Sales volume
8 Variable budgeted manufacturing cost
9 Total budgeted fixed manufacturing costs
24

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