變動成本法與吸收成本法 英文版

OverheadApplication:VariableandAbsorptionCosting變動成本法與吸收成本法AbsorptionCosting吸收成本法Asystemofaccountingforcostsinwhichbothfixedandvariableproductioncostsareconsideredproductcosts.FixedCostsVariableCostsProductVariableCosting變動成本法Asystemofcostaccountingthatonlyassignsthevariablecostofproductiontoproducts.FixedCostsVariableCostsProductAbsorptionandVariableCostingAbsorptionandVariableCostingThedifferencebetweenabsorptionandvariable

costingisthetreatmentoffixedmanufacturingoverhead.Let’sputsomenumberstoanexampleandseewhatwecanlearnaboutthedifferencebetweenabsorptionandvariablecosting.AbsorptionandVariableCostingGreenbergCase

see:P581VariablecostingFixedfactoryoverheadnottobeallocatedtotheproductsmanufactured.Unitproductcostonlyincludesvariablemanufacturingcosts(directmaterials,directlabor,variablefactoryoverhead)Unitproductcost20X020X1Directmaterial$1.31.3Directlabor

1.51.5Variablefactoryoverhead

0.20.2Standardvariablemanufacturingcost$3$3Unitproductcost$3$3Endinginventorycost30,000×310,000×3Salesrevenue(140,000@$5)700,000Variableexpenses:

Openinginventory0

+costofgoodsmanufactured(170,000@$3)510,000

-endinginventory(30,000@$3)

90,000

costofgoodssold(140,000@$3)420,000

variablesellingexpense(5%ofsales)

35,000Totalvariableexpenses455,000ContributionMargin245,000Fixedexpenses:

fixedfactoryoverhead

150,000

fixedsellingandadministrativeexpenses

65,000

totalfixedexpenses215,00Operatingincome(variablecosting)

30,000Salesrevenue(160,000@$5)800,000Variableexpenses:

Openinginventory(30,000@$3)90,000

+costofgoodsmanufactured(140,000@$3)420,000

-endinginventory(10,000@$3)

30,000

costofgoodssold(160,000@$3)480,000

variablesellingexpense(5%ofsales)

40,000Totalvariableexpenses520,000ContributionMargin280,000Fixedexpenses:

fixedfactoryoverhead

150,000

fixedsellingandadministrativeexpenses

65,000

totalfixedexpenses215,00Operatingincome(variablecosting)

65,000AbsorptioncostingFixedfactoryoverheadtobeallocatedintotheproductmanufactured.Unitcostofproductincludesallmanufacturingcosts(directmaterial,directlabor,variablefactoryoverhead,andfixedfactoryoverhead)StandardunitcostexpectedFixedfactoryoverhead$150,000tobeallocatedintotheproductsunderfixedoverheadrate.Fixedoverheadrate=budgetedFFO/expectedvolumeofproduction=$150,000/150,000=$1Productionvolumevariance=(actualvolume––expectedvolume)××fixedoverheadrateStandardunitcostofproduct=standardvariablemanufacturingcost+fixedoverheadrate=$3+$1=$4Unitcost20X020X1Directmaterial$1.3Directlabor

1.5Variablefactoryoverhead

0.2Standardvariablemanufacturingcost$3$3Totalfixedfactoryoverhead$150,000$150,000ExpectedProductionunits150,000

150,000Unitfixedfactoryoverhead$11Unitproductcost$4$4Endinginventorycost30,000×410,000×4Salesrevenue(140,000@$5)700,000costofgoodssold:Openinginventory0

+costofgoodsmanufactured(170,000@$4)580,000

-endinginventory(30,000@$4)120,000

costofgoodssold(140,000@$4)560,000Grossmargin140,000Production-volumevariance(170,000–150,000)20,000Grossprofitatactual160,000Sellingexpenses65,000Sellingcommissions(5%ofsales)35,000Operatingincome(variablecosting)60,000Salesrevenue(160,000@5)800,000costofgoodssold:Openinginventory(30,000$4)120,00

+costofgoodsmanufactured(140,000@4)560,000

-endinginventory(10,000@4)40,000

costofgoodssold(160,000@4)640,000Grossmargin160,000Production-volumevariance(140,000–150,000)-10,000Grossprofitatactual150,000Sellingexpenses65,000Sellingcommissions(5%ofsales)40,000Operatingincome(variablecosting)45,000

Variablecosting20X020X1Salesrevenue700,000800,000Variableexpenses455,000520,000Contributionmargin245,000280,000Fixedexpenses215,000215,000Operationincome

30,00065,000Beginninginventory090,000Endinginventory90,00030,000

Absorptioncosting20X020X1Salesrevenue700,000800,000manufacturingcost560,000640,000Grossmargin140,000160,000Productionvariance20,000-10,000Non-manufacturingexpenses100,000105,000Operationincome

60,00045,000Beginninginventory0120,000Endinginventory120,00040,000SelectionofexpectedactivitylevelforcomputingthefixedoverheadrateFixedoverheadrate=budgetedFFO/expectedvolumeofproductionThehigherthelevelofactivity,thelowertherateTherearethreewaystodecidethelevelofactivityActualcosting

Normalcosting

StandardcostingDirectmaterialsActualcostsActualcostsstandardpriceorrate×standardinputsallowedforactualoutputachievedDirectlaborActualcostsActualcostsFactoryoverheadActualcostsBudgetedrate×actualinputsUnderActualCostingAllocatefixedfactoryoverheadintoproductsUnitcost20X020X1Directmaterial$1.3Directlabor

1.5Variablefactoryoverhead

0.2Standardvariablemanufacturingcost$3$3Totalfixedfactoryoverhead$150,000$150,000Productionunits170,000

140,000Unitfixedfactoryoverhead$0.8821.071Unitproductcost$3.882$4.071Endinginventorycost30,000×3.88210,000×4.071Salesrevenue(140,000@5)700,000costofgoodssold:

Openinginventory0

+costofgoodsmanufactured(170,000@3+150,000)660,000

-endinginventory(30,000@3.882)116,520

costofgoodssold(140,000@3.882)543,480Grossmargin156,520Sellingexpenses65,000Sellingcommissions(5%ofsales)35,000Operatingincome(variablecosting)

56,520Salesrevenue(160,000@5)800,000costofgoodssold:

Openinginventory(30,000@3.882)116,460

+costofgoodsmanufactured(140,000@3+150,000)570,000

-endinginventory(10,000@4.071)40,710

costofgoodssold(140,000@3.882)645,750Grossmargin154,250Sellingexpenses65,000Sellingcommissions(5%ofsales)40,000Operatingincome(variablecosting)

49,250MellonCaseMellonCducesasingleproductwiththefollowinginformationavailableAbsorptionandVariableCostingUnitproductcostisdeterminedasfollows:AbsorptionandVariableCostingSellingandadministrativeexpensesarealwaystreatedasperiodexpensesanddeductedfromrevenue.AbsorptionCostingIncomeStatementsMellonCo.hadnobeginninginventory,produced25,000unitsandsold20,000unitsthisyearat$30each.AbsorptionCostingIncomeStatementsMellonCo.hadnobeginninginventory,produced25,000unitsandsold20,000unitsthisyearat$30each.MellonCo.hadnobeginninginventory,produced25,000unitsandsold20,000unitsthisyearat$30each.AbsorptionCostingIncomeStatementsVariableCostingIncomeStatementsVariableCostingIncomeStatementsWeexcludethefixedmanufacturingoverhead.VariableCostingIncomeStatementsComparingAbsorptionandVariableCostingLet’’scomparethemethods.ComparingAbsorptionandVariableCostingLet’’scomparethemethods.ComparingAbsorptionandVariableCostingLet’’scomparethemethods.ReconcilingIncomeUnderAbsorptionandVariableCostingWecanreconcilethedifferencebetweenabsorptionandvariablenetincomeasfollows:Fixedmfg.overhead$150,000Unitsproduced25,000=$6.00perunit=ExtendingtheExampleLet’’slookatthesecondyearofoperationsforMellonCompany.MellonCo.Year2Initssecondyearofoperations,MellonCo.startedwithaninventoryof5,000units,produced25,000unitsandsold30,000unitsat$30each.MellonCo.Year2Unitproductcostisdeterminedasfollows:TherehasbeennochangeinMellon’scoststructure.MellonCo.Year2Nowlet’slookatMellon’’sincomestatementassumingabsorptioncostingisused.MellonCo.Year2Unitsinendinginventoryfromthepreviousperiod.MellonCo.Year225,000unitsproducedinthecurrentperiod.MellonCo.Year2Next,we’lllookatMellon’sincomestatementassumingvariablecostingisused.MellonCo.Year2MellonCo.Year2Excludesfixedmanufacturingoverhead.SummaryInthefirstperiod,production(25,000units)wasgreaterthansales(20,000).Inthesecondperiod,production(25,000units)waslessthansales(30,000).SummaryForthetwo-yearperiod,totalabsorptionincomeandtotalvariableincomearethesame.SummaryLet’sseeifwecangetanoverviewofwhatwehavedone.SummaryComparisonofAbsorption(AC)andVariableCosting(VC)Thiswasthecaseinthefirstperiodwhenproductionof25,000unitswasgreaterthansalesof20,000units.Inventoryincreasedfromzeroto5,000unitsand$120,000absorptionincomewasgreaterthan$90,000variableincome.SummaryComparisonofAbsorption(AC)andVariableCosting(VC)Inthesecondperiodsalesof30,000unitsweregreaterthanproductionof25,000.SummaryComparisonofAbsorption(AC)andVariableCosting(VC)Inventorydecreasedfrom5,000unitstozero,and$230,000absorptionincomewaslessthan$260,000variableincome.SummaryComparisonofAbsorption(AC)andVariableCosting(VC)Forthetwo-yearperiod,unitsproducedequalsunitssold,sototalabsorptionincomeequalstotalvariableincome.Cost-Volume-