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Question: The following data were adapted from a

The following data were adapted from a recent income statement of Procter & Gamble Company:
The following data were adapted from a recent income statement of Procter & Gamble Company:


Assume that the variable amount of each category of operating costs is as follows:


A. Based on the data given, prepare a variable costing income statement for Procter & Gamble Company, assuming that the company maintained constant inventory levels during the period.
B. If Procter & Gamble reduced its inventories during the period, what impact would that have on the income from operations determined under absorption costing?

Assume that the variable amount of each category of operating costs is as follows:
The following data were adapted from a recent income statement of Procter & Gamble Company:


Assume that the variable amount of each category of operating costs is as follows:


A. Based on the data given, prepare a variable costing income statement for Procter & Gamble Company, assuming that the company maintained constant inventory levels during the period.
B. If Procter & Gamble reduced its inventories during the period, what impact would that have on the income from operations determined under absorption costing?

A. Based on the data given, prepare a variable costing income statement for Procter & Gamble Company, assuming that the company maintained constant inventory levels during the period. B. If Procter & Gamble reduced its inventories during the period, what impact would that have on the income from operations determined under absorption costing?





Transcribed Image Text:

(In millons) Sales.... $83,062 Operating costs: Cost of products sold..... Marketing, administrative, and other expenses. Total operating costs. Income from operations... $42,460 25,314 $67,774 $15,288 ...... (in millions) Cost of products sold..... Marketing, administrative, and other expenses . $23,778 10,125


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