Acc202 Mod3 Case Essay

ACC202 staff 3 representative Pg.1ACC202 Module 3 Case James Davis Trident UniversityACC202 Module 3 Case Pg.2Explain the main differences amongst the ducking and character (behavioral, multivariate) income statements. Will earn income always be the same to a lower place the two approaches? If not, explain the difference. Under absorption income statement, the follow of per unit of measurement of inventory is inclusive of tell material, direct labor, unsettled manufacturing disk overhead and laid manufacturing overhead. on the other hand, in miscue of variable be income statement, hail per unit of inventory is inclusive of direct material, direct labor, variable manufacturing overhead. In case of absorption costing income statement, the gross valuation account is computed by deducting the cost of goods sold from the sales. On the other hand, in case of variable costing income statement variable expenses be deducted from sales to arrive at sh ar margin and the f ixed expenses are deducted from the contribution margin to arrive at sales. In case of absorption costing, the inventories are always valued at full costs. On the other hand, under variable costing, inventories are always valued at variable costs. The net income under two approaches willing be the same if the intersectionion equals sales. In case the outpution is to a greater extent than the sales, consequently absorption costing will give tongue to more profit than the variable costing income statement because the closing stock is valued at high cost per unit compared to variable costing because of inclusion of fixed manufacturing cost in the cost per unit. imagine moreThe 3 Types of Satire assayComment specifically on wherefore companies feel the need to create to date another income statement in a different format. What information open fire the companionshipgleam from this approach which is helpful as a tool in the ending making process. Managers need more ,and frequ ently times different, information than does outside organizations. The managers are the ones making the decisions that will affect the rising of the company. The income statements that are created show much more detail and are formatted for specific reasons that are beneficial to the organization.ACC202 Module 3 Case Pg.3Explain situations in which break-even analysis can be a useful tool. pass on a specific good example. The goal of a break-even analysis is to show when a product is going to profitable. It allows managers to see what affects different cost changes have on the profit margin. An example of this is when Company A is developing product B. The break-even analysis shows all costs associated with producing that product. It as well as shows how much of the product must be sold in order to compensate the total cost of production. It will overly allow managers to tweak things such as sell price to influence the outcome.