1. ABC Manufacturing has the following cost structure:

Direct material (DM) per unit (DM/u) $4

Direct Labor (DL) per unit (DM/u $6

Variable manufacturing overhead (VMO) per unit (VMO/u) $2

Fixed manufacturing overhead per year $10,000

Fixed selling and administrative expenses $20,000

Assume

units produced 10,000

units sold 8,000

Using absorption costing, find total manufacturing costs for units sold

1. $84,000
2. $92,000
3. $96,000
4. between $102,000 and $105,000