A manufacturing company that produces a single product has provided the followin
ID: 2388895 • Letter: A
Question
A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations:Units in beginning inventory..........0
Units produced.......................6,500
Units sold..............................6,300
Units in ending inventory..............200
Variable costs per unit:
Direct materials......................$26
Direct labor...........................$55
Variable manufacturing overhead...$6
Variable selling and admin............$7
Fixed costs:
Fixed manufacturing overhead$.....$130,000
Fixed selling and admin..................$69,300
What is the absorption costing unit product cost for the month?
a. $107 b. $94 c. $87 d. $114
Explanation / Answer
A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations:
Units in beginning inventory..........0
Units produced.......................6,500
Units sold..............................6,300
Units in ending inventory..............200
Variable costs per unit:
Direct materials......................$26
Direct labor...........................$55
Variable manufacturing overhead...$6
Variable selling and admin............$7
Fixed costs:
Fixed manufacturing overhead$.....$130,000
Fixed selling and admin..................$69,300
What is the absorption costing unit product cost for the month?
a. $107 b. $94 c. $87 d. $114
unit fix ------13000/6500 =20 dollars
unit product cost for the month= 26+55+6+20= 107 dollars
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