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yessi1836
yessi1836
13.01.2022 • 
Business

Enusah Motors Limited assembles and sells motor vehicles. It uses an actual costing system, in which unit costs are calculated on a monthly basis. The selling price per motor vehicle is ¢44,000. Data relating to January, February and March of 2020 are:      January  February  March  Unit data:        Production (units)  1000  1000  900  Sales (units)  900  1040  940    100  60  20  Variable-cost data:        Manufacturing costs per unit produced  ¢16,000  ¢16,000  ¢16,000  Selling and Admin costs per unit sold  8,000  8,000  8,000          Fixed-cost data        Manufacturing costs  ¢2,400,000  ¢2,400,000  ¢2,400,000  Selling and Admin costs  ¢1,600,000  ¢1,600,000  ¢1,600,000      Required:  Compute the product cost per unit under both variable and absorption costing methods  Present income statements for Enusah Motors in January, February and March of 2020 under   Variable costing   Absorption costing.   Reconcile and explain the differences in operating profits under both costing methods 

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