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Absorption and marginal costing


On practice exam 1, it asks me to work out the closing inventory on a FIFO basis - I can work out everything else other than the closing inventory for month 3 as the sales is more than the production.

The details are as follows:

Month 1 Month 2 Month 3

Selling price 110 100 90

Production (units) 10000 10000 10000

Sales (units) 8000 9000 11000

Direct materials 15 15 15

Direct Labour 10 10 10

Other Variable production costs 230,000 230,000 250,000

Fixed production costs 450,000 450,000 450,000

Please can someone help :)


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