變動(dòng)成本法與吸收成本法(ppt 58)(英文版)

OverheadApplication:VariableandAbsorptionCosting變動(dòng)成本法與吸收成本法1AbsorptionCosting吸收成本法Asystemofaccountingforcostsinwhichbothfixedandvariableproductioncostsareconsideredproductcosts.FixedCostsVariableCostsProduct2VariableCosting變動(dòng)成本法Asystemofcostaccountingthatonlyassignsthevariablecostofproductiontoproducts.FixedCostsVariableCostsProduct3AbsorptionandVariableCosting4AbsorptionandVariableCostingThedifferencebetweenabsorptionandvariable

costingisthetreatmentoffixedmanufacturingoverhead.5Let’sputsomenumberstoanexampleandseewhatwecanlearnaboutthedifferencebetweenabsorptionandvariablecosting.AbsorptionandVariableCosting6GreenbergCase

see:P5817VariablecostingFixedfactoryoverheadnottobeallocatedtotheproductsmanufactured.Unitproductcostonlyincludesvariablemanufacturingcosts(directmaterials,directlabor,variablefactoryoverhead)891011AbsorptioncostingFixedfactoryoverheadtobeallocatedintotheproductmanufactured.Unitcostofproductincludesallmanufacturingcosts(directmaterial,directlabor,variablefactoryoverhead,andfixedfactoryoverhead)12StandardunitcostexpectedFixedfactoryoverhead$150,000tobeallocatedintotheproductsunderfixedoverheadrate.Fixedoverheadrate

=budgetedFFO/expectedvolumeofproduction

=$150,000/150,000=$1Productionvolumevariance=(actualvolume–expectedvolume)×fixedoverheadrate13Standardunitcostofproduct

=standardvariablemanufacturingcost+fixedoverheadrate=$3+$1=$4141516171819Selectionofexpectedactivitylevelforcomputingthefixedoverheadrate

Fixedoverheadrate

=budgetedFFO/expectedvolumeofproduction

Thehigherthelevelofactivity,thelowertherateTherearethreewaystodecidethelevelofactivity2021UnderActualCostingAllocatefixedfactoryoverheadintoproducts22232425MellonCase26

MellonCducesasingleproductwiththefollowinginformationavailableAbsorptionandVariableCosting27Unitproductcostisdeterminedasfollows:AbsorptionandVariableCostingSellingandadministrativeexpensesarealwaystreatedasperiodexpensesanddeductedfromrevenue.28AbsorptionCostingIncomeStatementsMellonCo.hadnobeginninginventory,produced25,000unitsandsold20,000unitsthisyearat$30each.29AbsorptionCostingIncomeStatementsMellonCo.hadnobeginninginventory,produced25,000unitsandsold20,000unitsthisyearat$30each.30MellonCo.hadnobeginninginventory,produced25,000unitsandsold20,000unitsthisyearat$30each.AbsorptionCostingIncomeStatements31VariableCostingIncomeStatements32VariableCostingIncomeStatementsWeexcludethefixedmanufacturingoverhead.33VariableCostingIncomeStatements34ComparingAbsorptionand

VariableCostingLet’scomparethemethods.35ComparingAbsorptionand

VariableCostingLet’scomparethemethods.36ComparingAbsorptionand

VariableCostingLet’scomparethemethods.37ReconcilingIncomeUnderAbsorptionandVariableCosting

Wecanreconcilethedifferencebetweenabsorptionandvariablenetincomeasfollows:Fixedmfg.overhead

$150,000

Unitsproduced25,000

=$6.00perunit

=38ExtendingtheExampleLet’slookatthesecondyearofoperationsforMellonCompany.39MellonCo.Year2

Initssecondyearofoperations,MellonCo.startedwithaninventoryof5,000units,produced25,000unitsandsold30,000unitsat$30each.40MellonCo.Year2Unitproductcostisdeterminedasfollows:TherehasbeennochangeinMellon’scoststructure.41MellonCo.Year2Nowlet’slookatMellon’sincomestatementassumingabsorptioncostingisused.42MellonCo.Year2Unitsinendinginventoryfromthepreviousperiod.43MellonCo.Year225,000unitsproducedinthecurrentperiod.44MellonCo.Year2Next,we’lllookatMellon’sincomestatementassumingvariablecostingisused.45MellonCo.Year246MellonCo.Year2Excludesfixedmanufacturingoverhead.47SummaryInthefirstperiod,production(25,000units)wasgreaterthansales(20,000).Inthesecondperiod,production(25,000units)waslessthansales(30,000).48SummaryForthetwo-yearperiod,totalabsorptionincomeandtotalvariableincomearethesame.49SummaryLet’sseeifwecangetanoverviewofwhatwehavedone.50SummaryComparisonofAbsorption(AC)andVariableCosting(VC)Thiswasthecaseinthefirstperiodwhenproductionof25,000unitswasgreaterthansalesof20,000units.Inventoryincreasedfromzeroto5,000unitsand$120,000absorptionincomewasgreaterthan$90,000variableincome.51SummaryComparisonofAbsorption(AC)andVariableCosting(VC)Inthesecondperiodsalesof30,000unitsweregreaterthanproductionof25,000.52SummaryComparisonofAbsorption(AC)andVariableCosting(VC)Inventorydecreasedfrom5,000unitstozero,and$230,000absorptionincomewaslessthan$260,000variableincome.53SummaryComparisonofAbsorption(AC)andVariableCosting(VC)Forthetwo-yearperiod,unitsproducedequalsunitssold,sototalabsorptionincomeequalstotalvariableincome.54Cost-Volume-ProfitAnalysisCVPincludesallfixedcoststocomputebreakeven.VariablecostingandCVPareconsistentasbothtreatfixedcostsasalumpsum.Absorptioncostingdefersfixedcostsintoinventory.AbsorptioncostingisinconsistentwithCVPbecauseabsorptioncostingtreatsfixedcostsonaperunitbasis.55AdvantagesManagementfindsiteasytounderstand.ConsistentwithCVPanalysis.Emphasizescontributionin