A company has computed the following unit costs for the year just ended: Direct

Question

A company has computed the following unit costs for the year just ended: Direct material used $25 Direct labor $19 Variable manufacturing overhead $35 Fixed manufacturing overhead $40 Variable selling and administrative cost $17 Fixed selling and administrative cost $32 Which of the following choices correctly depicts the per-unit cost of inventory under variable costing and absorption costing? Variable Costing Absorption Costing A. $79 $119 B. $79 $151 C. $96 $119 D. $96 $151 E. Other combination of figures not listed above.

Explanation / Answer

Variable costing is 25 + 19 + 35 + 17 = 96

Absorption Costing = 25 + 19 + 35 + 40 + 17 + 32 = 158

Hence E) Othe Combination

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