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 8,900

Units sold 8,500

Units in ending inventory 400

Variable costs per unit:

Direct materials $ 26

Direct labor $ 25

Variable manufacturing overhead $ 4

Variable selling and administrative expense $ 4

Fixed costs:

Fixed manufacturing overhead $ 249,200

Fixed selling and administrative expense $ 17,000

What is the variable costing unit product cost for the month?

a. $59 per unit

b. $55 per unit

c. $87 per unit

Question

Business

Marissa Hebert

19 February, 18:01

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 8,900

Units sold 8,500

Units in ending inventory 400

Variable costs per unit:

Direct materials $ 26

Direct labor $ 25

Variable manufacturing overhead $ 4

Variable selling and administrative expense $ 4

Fixed costs:

Fixed manufacturing overhead $ 249,200

Fixed selling and administrative expense $ 17,000

What is the variable costing unit product cost for the month?

a. $59 per unit

b. $55 per unit

c. $87 per unit

+3

Answers (1)

Know the Answer?

Ruth Daugherty · Answer 1

The correct answer is B.

Explanation:

Giving the following information:

Variable costs per unit:

Direct materials $ 26

Direct labor $ 25

Variable manufacturing overhead $ 4

Variable selling and administrative expense $ 4

Under the variable cost method, the unitary cost of production is calculated as:

Unitary variable cost = direct material + direct labor + variable overhead

Unitary VC = 26 + 25 + 4 = $55