Reference no: EM132482193

Question - Langdon Company produced 8,600 units during the past year, but only 8,200 of the units were sold. The following additional information is also available.

Direct materials used $79,500

Direct labor incurred $29,500

Variable manufacturing overhead $20,000

Fixed manufacturing overhead $51,600

Fixed selling and administrative expenses $71,500

Variable selling and administrative expenses $8,000

There was no work in process inventory at the beginning and end of the year, nor did Langdon have any beginning finished goods inventory.

What would be Langdon companies' finished goods inventory cost on December 31st under variable costing?

Which method, absorption or variable, would show higher net income and by how much?