Chapter 8 Pre-Class Notes

Chapter 8 Pre-Class Notes - 8- 1 MANAGERIAL ACCOUNTING...

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8-1 MANAGERIAL ACCOUNTING RSM222 Variable Costing: A Tool for Management Chapter 8
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8-2 Overview of Absorption and Variable Costing Direct Materials Direct Labour Variable Manufacturing Overhead Fixed Manufacturing Overhead Variable Selling and Administrative Expenses Fixed Selling and Administrative Expenses Variable Costing Absorption Costing LO 1
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8-3 Harvey Company produces a single product with the following information available: Number of units produced annually 25,000 Variable costs per unit: Direct materials, direct labour, and variable mfg. overhead 10 $ Selling & administrative expenses 3 $ Fixed costs per year: Manufacturing overhead 150,000 $ 100,000 $ Unit Cost Computations LO 1
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8-4 Unit product cost is determined as follows: Under absorption costing , selling and administrative expenses are always treated as period expenses and deducted from revenue as incurred. Absorption Costing Variable Costing Direct materials, direct labour, and variable mfg. overhead Fixed mfg. overhead ($_______ ÷ _______ units) Unit product cost Unit Cost Computations LO 1
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8-5 Income Comparison of Absorption and Variable Costing Let’s assume the following additional information for Harvey Company.
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This note was uploaded on 04/03/2012 for the course RSM 222 taught by Professor D.cianflone during the Spring '10 term at University of Toronto- Toronto.

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Chapter 8 Pre-Class Notes - 8- 1 MANAGERIAL ACCOUNTING...

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