Asked by Aa'Kyra Rivers on Jun 08, 2024
Verified
What is the total period cost for the month under variable costing?
A) $54,400
B) $69,400
C) $57,400
D) $15,000
Total Period Cost
The sum of all expenses incurred by a business within a specific period, including both fixed and variable costs.
- Identify the differences in period costs, unit product costs, and net operating income between variable costing and absorption costing.
Verified Answer
TB
Trini BrittJun 10, 2024
Final Answer :
B
Explanation :
Under variable costing, the total period cost for the month is calculated as follows:
Direct material cost + Direct labor cost + Variable manufacturing overhead cost + Variable selling and administrative cost
= $27,000 + $12,000 + ($4 * 4,000) + ($1 * 16,000)
= $27,000 + $12,000 + $16,000 + $16,000
= $69,400
Therefore, the best choice is B.
Direct material cost + Direct labor cost + Variable manufacturing overhead cost + Variable selling and administrative cost
= $27,000 + $12,000 + ($4 * 4,000) + ($1 * 16,000)
= $27,000 + $12,000 + $16,000 + $16,000
= $69,400
Therefore, the best choice is B.
Explanation : 
Learning Objectives
- Identify the differences in period costs, unit product costs, and net operating income between variable costing and absorption costing.
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