Selected account balances for the year ended December 3 1 are provided below for Superior Company:

Inventory balances at the beginning and end of the year were as follows:

The total manufacturing costs for the year were \($683,000;\) the goods available for sale totaled \($740,000;
and\) the cost of goods sold totaled $660,000.
Required:
1. Prepare a schedule of cost of goods manufactured and the cost of goods sold section of the company's income statement for the year.
2. The company produced the equivalent of 40,000 units during the year. Compute the average cost per unit for direct materials used and the average cost per unit for rent on the factory building.
3. In the following year the company expects to produce 50,000 units. What average cost per unit and total cost would you expect to be incurred for direct materials? For rent on the factory building?
(Assume that direct materials is a variable cost and that rent is a fixed cost.)
4. Explain to the president the reason for any difference in average cost per unit between (2) and (3) above.

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Selling and administrative salaries Insurance, factory Utilities, factory... Purchases of raw materials Indirect labor... Direct labor Advertising expense $110,000 $8,000 $45,000 $290,000 $60,000 ? $80,000 Cleaning supplies, factory Sales commissions.. Rent, factory building Maintenance, factory $7,000 $50,000 $120,000 $30,000