Columbia Products produced and sold 1,200 units of the company's only product in March. You have collected the following information from the accounting records:

Sales price (per unit) $125

Manufacturing costs:

Fixed overhead (for the month) 18,200

Direct labor (per unit) 10

Direct materials (per unit) 34

Variable overhead (per unit) 26

Marketing and administrative costs:

Fixed costs (for the month) 19,500

Variable costs (per unit) 5

Compute the following:

(1) Variable manufacturing cost per unit.

(2) Full cost per unit.

Question

Business

Marina

9 December, 18:08

Columbia Products produced and sold 1,200 units of the company's only product in March. You have collected the following information from the accounting records:

Sales price (per unit) $125

Manufacturing costs:

Fixed overhead (for the month) 18,200

Direct labor (per unit) 10

Direct materials (per unit) 34

Variable overhead (per unit) 26

Marketing and administrative costs:

Fixed costs (for the month) 19,500

Variable costs (per unit) 5

Compute the following:

(1) Variable manufacturing cost per unit.

(2) Full cost per unit.

+5

Answers (1)

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Flores · Answer 1

1. $70

2. $106.42

Explanation:

(1) Variable manufacturing cost per unit:

= Direct labor + Direct material + Variable overhead

= $10 + $34 + $26

= $70

(2) Full cost per unit:

= Direct labor + Direct material + Variable overhead + Variable selling cost + (Fixed : 1,200)

= $10 + $34 + $26 + $5 + [ (19,500 + 18,200) : 1,200) ]

= $75 + $31.42

= $106.42