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4 October, 22:50

The following cost behavior patterns describe anticipated manufacturing costs for 2019: raw material, $7.90/unit; direct labor, $10.90/unit; and manufacturing overhead, $347,100 $8.90/unit. Required: If anticipated production for 2019 is 39,000 units, calculate the unit cost using variable costing and absorption costing. (Round your answers to 2 decimal places.)

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  1. 4 October, 23:59
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    Variable unit cost = $27.70

    Absorption cost = $36.60

    Explanation:

    The calculation of unit cost using variable costing and absorption costing is shown below:-

    Variable costing Absorption costing

    Raw material per unit $7.90 $7.90

    Direct labor per unit $10.90 $10.90

    Variable manufacturing

    overhead per unit $8.90 $8.90

    Fixed manufacturing

    overhead per unit $8.9

    ($347,100 : 39,000)

    Unit cost $27.70 $36.60

    Therefore the variable unit cost is $27.70 and absorption cost is $36.6 by using the above computation.
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