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

Question

Ida Sidha Karya Company is a family-owned company located in the village of Gianyar 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 $871. Selected data for the company's operations last year follow: beginning inventory Units in Units produced Units sold Units in ending inventory Variable costs per unit: 22,000 20,000 2,000 Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative $ 220 $410 58 23 Fixed costs: Fixed manufacturing overhead Fixed selling and administrative $950,000 $510,000 Required: 1. Assume that the company uses absorption costing. Compute the unit product cost for one gamelan. (Round your intermediate calculations and final answer to the nearest whole dollar amount.) 2. Assume that the company uses variable costing. Compute the unit product cost for one gamelan Absorption costing unit product cost 2. Variable costing unit product cost

Explanation / Answer

1 Direct materials 220 Direct labor 410 Variable manufacturing overhead 58 Fixed manufacturing overhead 43 =950000/22000 Absorption costing unit product cost 731 2 Direct materials 220 Direct labor 410 Variable manufacturing overhead 58 Variable costing unit product cost 688

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