XM

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XM Outfitters produces Kayaks. Use the attachment below which contains information for the first three years of business and use it to present your calculations and answers to the questions below:

  • Calculate profit and the value of ending inventory for each year using full costing.
  • Explain why profit fluctuates from year to year even though the units sold and selling price remains the same.
  • Calculate profit and the value of ending inventory for each year using variable costing.
  • Explain why when using variable costing profit does not fluctuate from year to year.

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