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  • Indo British Company

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    The document shows cost information for an Indo-British company using both absorption costing and marginal costing methods. Under absorption costing, the company produced 2000 units for the home market and 3000 units for the foreign market, with total costs of ₹152,000 and ₹171,000 respectively. The total profit was ₹2,000. Using marginal costing, fixed costs are not considered in determining costs for the foreign market. As a result, the total cost is lower at ₹283,000 and the profit is higher at ₹48,000.

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    indo british company.xlsx

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    The document shows cost information for an Indo-British company using both absorption costing and marginal costing methods. Under absorption costing, the company produced 2000 units for the home market and 3000 units for the foreign market, with total costs of ₹152,000 and ₹171,000 respectively. The total profit was ₹2,000. Using marginal costing, fixed costs are not considered in determining costs for the foreign market. As a result, the total cost is lower at ₹283,000 and the profit is higher at ₹48,000.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
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    6 views9 pages

    Indo British Company

    Uploaded by

    sohail
    The document shows cost information for an Indo-British company using both absorption costing and marginal costing methods. Under absorption costing, the company produced 2000 units for the home market and 3000 units for the foreign market, with total costs of ₹152,000 and ₹171,000 respectively. The total profit was ₹2,000. Using marginal costing, fixed costs are not considered in determining costs for the foreign market. As a result, the total cost is lower at ₹283,000 and the profit is higher at ₹48,000.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as xlsx, pdf, or txt
    of 9

    INDO BRITISH COMPANY (absorption costing method)

    PARTICULARS

    HOME MARKET

    units
    materials
    wages
    factoryo/h
    fixed
    variable
    administrative
    fixed
    selling and distribution
    fixed
    packaging
    variable
    total
    sales
    profit

    FOREIGN MARKET

    2000

    3000

    40,000.00
    36,000.00

    Amount in Rs.
    60,000.00
    54,000.00

    12,000.00
    20,000.00

    30,000.00

    18,000.00

    Rs.80

    10,000.00
    NA
    16,000.00
    152,000.00
    160,000.00
    8,000.00

    65.00

    3,000.00
    24,000.00
    171,000.00
    195,000.00
    24,000.00

    TOTAL

    5000

    Rs.
    100,000.00
    90,000.00
    12,000.00
    50,000.00
    18,000.00

    10,000.00
    3,000.00
    40,000.00
    323,000.00
    325,000.00
    2,000.00
    in foreign mrket we are not including fixed cost coz fixed cost has alredy being incured in margina

    e firm is not incurring any fixed cost for the marginal production. this order paves a way for further expansion of

    g incured in marginal costing method fixed cost is not considered in productivity .

    further expansion of the product overseas. under the marginal costing method the total cost is 72000 the rate o

    INDO BRITISH COMPANY (marginal costing)


    PARTICULARS

    HOME MARKET

    units
    materials
    wages
    factoryo/h
    fixed
    variable
    administrative
    fixed
    selling and distribution
    fixed
    packaging
    variable
    total
    sales
    profit

    Rs.80

    FOREIGN MARKET

    2000

    3000

    40,000.00
    36,000.00

    Amount in Rs.
    60,000.00
    54,000.00

    20,000.00

    30,000.00

    NA
    16,000.00
    112,000.00
    160,000.00 Rs.65
    48,000.00

    3,000.00
    24,000.00
    171,000.00
    195,000.00
    24,000.00

    TOTAL

    5000

    Rs.
    100,000.00
    90,000.00
    only variable cost is considered
    0.00
    50,000.00
    0.00
    0.00
    3,000.00
    40,000.00
    283,000.00

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