Ida Sidha Karya Company is a family-owned company located in the village of Glan

Question

Ida Sidha Karya Company is a family-owned company located in the village of Glanyar on the island of Bali in Indonesia. The company produces a handcrafted Balinese musical instrument called a gamelan that is similar to a xylophone. The gamelans are sold for $810. Selected data for the company's operations last year follow: Assume that the company uses absorption costing. Compute the unit product cost for one gamelan. (Round your intermediate calculations and final answer to nearest whole dollar.) Assume that the company uses variable costing. Compute the unit product cost for one gamelan.

Explanation / Answer

1. The Unit Product cost for gamelan under Absorption Costing is Particular Amount ($) Direct Material                      120 Direct labour                      460 Variable Manufacturing overhead                        59 Fixed manufacturing overhead ( 660000/21000) 31 Cost per unit of gamelan 670 2. The Unit Product cost for gamelan under Variable costing is Particular Amount ($) Direct Material                      120 Direct labour                      460 Variable Manufacturing overhead                        59 Cost per unit of gamelan                      639

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