A) The company, Crafts 4 All, has these costs associated with the production of 12,000 units of accessory products:

• direct materials, $19;
• direct labor, $30;
• variable manufacturing overhead, $15;
• total fixed manufacturing overhead, $450,000.

Calculate the cost per unit under both the variable costing and absorption methods.

B)Grainger Company produces only one product and sells that product for $100 per unit. Cost information for the product is:

Direct Material$15 per Unit

Direct Labor$25 per Unit

Variable Overhead$5 per Unit

Fixed Overhead$34,000

Selling expenses are $4 per unit and are all variable. Administrative expenses of $20,000 are all fixed.

Grainger produced 5,000 units, sold 4,000, and had no beginning inventory.

Calculate the Net Income using the Absorption Method.

C)

Grainger Company produces only one product and sells that product for $100 per unit. Cost information for the product is:

Direct Material$15 per Unit

Direct Labor$25 per Unit

Variable Overhead$5 per Unit

Fixed Overhead$34,000

Selling expenses are $4 per unit and are all variable. Administrative expenses of $20,000 are all fixed.

Grainger produced 5,000 units, sold 4,000, and had no beginning inventory.

Calculate the Net Income using the Variable Method.