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Case Study #3 Report
Case 4-29
Answer each question as if you were the managerial accountant for the company and are presenting to the company vice-president regarding the information requested in the case study. You must not only give the correct numbers but also explain to management what variable costing is, why variable costing is useful and why the net income is different for absorption vs variable costing, and also why net income is different for LIFO vs FIFO. Then follow the explanation up with a recommendation for management reporting.
For each answer explain the terminology and concepts used. For example, rather than just give the product cost/net income, explain the calculation – this is a professional report from a managerial accountant to the company vice-president.
Use outside sources when necessary BUT MAKE SURE YOU CITE THEM!
When giving a recommendation, back it up with numbers. Make sure you address the original dilemma – lowest bid in different situations.
This particular answer should be a managerial accounting report to the company president that is no more than 2 pages in length.


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