MC Qu. 168 A manufacturer reports the following costs to produce ... A manufacturer reports the following costs to produce 23,000 units in its first year of operations: Direct materials, $23 per unit, Direct labor, $19 per unit, Variable overhead, $276,000, and Fixed overhead, $322,000. The total product cost per unit under absorption costing is:

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Sabrina Bradshaw

Business

8 September, 15:59

MC Qu. 168 A manufacturer reports the following costs to produce ... A manufacturer reports the following costs to produce 23,000 units in its first year of operations: Direct materials, $23 per unit, Direct labor, $19 per unit, Variable overhead, $276,000, and Fixed overhead, $322,000. The total product cost per unit under absorption costing is:

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Cassie Vang · Answer 1

Unitary product cost = $68

Explanation:

Giving the following information:

23,000 units

Direct materials = $23 per unit

Direct labor = $19 per unit

Variable overhead = $276,000

Fixed overhead, $322,000

Under the absorption costing method, the unit product cost is calculated using the direct material, direct labor, and total unitary overhead.

Fixed unitary overhead = 322,000/23,000 = $14

Unitary variable overhead = 276,000/23,000 = $12

Total = $26

Unitary product cost = 23 + 19 + 26 = $68