(Solution) - Four Sheets FS Company uses standard costing Kate King the -(2025 Original AI-Free Solution)

Paper Details

Four Sheets (FS) Company uses standard costing. Kate King, the new president of FS Company, is presented with the following data for 2015:

Required
1. At what percentage of denominator level was the plant operating during 2015?
2. How much fixed manufacturing overhead was included in the 2014 and the 2015 ending inventory under absorption costing?
3. Reconcile and explain the difference in 2015 operating incomes under variable and absorption costing.
4. Kate King is concerned. She notes that despite an increase in sales over 2014, 2015 operating income has actually declined under absorption costing. Explain how this occurred.