The following data relates to Dott Ltd for the year ended 30th June 2018:
|Direct Costing||Absorption Costing|
|Inventories: 30th June 2017||164,000||176,000|
|Inventories: 30th June 2018||156,000||166,000|
Prepare a Reconciliation of the difference between the 2018 net profits under direct and absorption costing.
The Lake Side Company currently uses direct costing. The general manager has asked you to demonstrate the difference in profit or loss if they changed to absorption costing. The following information should be used.
The actual costs for July 2018 were:
|Variable manufacturing costs||$48,000|
|Fixed manufacturing costs||$32,000|
|Fixed selling and administration||$30,200|
|Budgeted and actual production||$10,000 units|
|Financial Marketing||Personal Financial||STIS08007 Science, Nature and Environment|
|Cash Flow Statement||Risk Management Practices in Accounting||Management Accounting|
|Income Statement||Cost Accounting||Corporate Disclosure and Governance|
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