Uche Ltd produces a single product and the following are the accounting data; Opening stock 20.000 units Production 30,000 units Closing stock 4,000 units The variable production cost per unit is £8 and the fixed production cost is £120,000. The sales revenue is £720,000. Net profit is £ 88,000 based on full absorption costing. What is the profit based on marginal costing? a. £124,000 more than absorption costing profit. b. £134,000 more than absorption costing profit. c. £144,000 more than absorption costing profit d. £154,000 more than absorption costing profit.

Uche Ltd produces a single product and the following are the accounting data; Opening stock 20.000 units Production 30,000 units Closing stock 4,000 units The variable production cost per unit is £8 and the fixed production cost is £120,000. The sales revenue is £720,000. Net profit is £ 88,000 based on full absorption costing. What is the profit based on marginal costing? a. £124,000 more than absorption costing profit. b. £134,000 more than absorption costing profit. c. £144,000 more than absorption costing profit d. £154,000 more than absorption costing profit.

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter7: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 46E: Lotts Company produces and sells one product. The selling price is 10, and the unit variable cost is...

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