Review%20for%20midterm%202%20-%20Acct%202332%20-%20Spring%202010

Review%20for%20midterm%202%20-%20Acct%202332%20-%20Spring%202010

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Chapter 5 Full/absorption costing income statement vs. variable costing income statement. What creates the difference in income between variable and full costing. How to calculate inventory under full and variable costing. Variable costing income cannot be manipulated by over- production.
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chapter 5 Following is a variable costing income statement. Sale price per unit is $60. The company had no beginning inventory, and produced this year 350,000 units. Required: 1)What is the inventory under variable costing. 2)Build an income statement using full costing. 3)what is the inventory under full costing. 4)Explain the source for the difference in net income between the variable costing and the full costing income statements.
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Chapter 6 Why we allocate costs (provide information, reduce frivolous use of resources etc.) Allocating costs: allocation base, cost pool, allocation rate. Allocation with multiple cost pools. Cost-plus contracts: tend to push more costs to the reimbursed part.
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