Coastal Corporation, Which Uses Throughput Costing, Began Operations at the Start

question 2

Essay

Coastal Corporation, which uses throughput costing, began operations at the start of the current year. Planned and actual production equaled 20,000 units, and sales totaled 17,500 units at $95 per unit. Cost data for the year were as follows: $\begin{array}{lr}\begin{array}{l}\text { Direct materials (per unit) } \\\text { Conversion cost: }\end{array} & \$ 18 \\\quad \text { Direct labor } & 160,000 \\\text { Variable manufacturing overhead } & 280,000 \\\quad \text { Fixed manufacturing overhead } & 340,000 \\\text { Selling and administrative costs (total) } & 430,000\end{array}$
Required:
A. Compute the company's total cost for the year.
B. How much of this cost would be held in year-end inventory under (1) absorption costing and (2) variable costing?
C. How much of the company's total cost for the year would appear on the period's income statement under (1) absorption costing and (2) variable costing?

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Definitions:

Declarative

Pertaining to statements or expressions that provide information or assert something as true.

Procedural

Related to or involving the procedures or steps taken to accomplish a task or process, often emphasizing the method over the result.

Self-esteem

A person's overall sense of their value or worth, or how much they appreciate and like themselves.

Procedural Knowledge

Knowledge of how to perform tasks or procedures, often contrasted with declarative knowledge, which involves facts and information.