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Arabica's planned production for the year that just ended was 10,000 units. Actual production totaled 10,000 units, and the company sold 11,000 units of its

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Arabica's planned production for the year that just ended was 10,000 units. Actual production totaled 10,000 units, and the company sold 11,000 units of its manufacturing output at $10 per unit. The following costs were incurred: Manufacturing costs: $ Direct material used 100,000 Direct labor 120,000 80,000 60,000 Variable manufacturing overhead Fixed manufacturing overhead Selling and administrative: Variable Selling and administrative Fixed Selling and administrative 60,000 180,000 Finished-goods inventory, January 1 2000 Required: A. Calculate the cost per unit produced using variable costing. (20 Marks) B. Calculate the cost per unit produced using absorption costing. (20 Marks) C. What would be the company's finished-goods inventory cost on December 31 under the variable-costing method? (20 Marks) D. Which costing methods, absorption or variable costing, would show a higher operating income for the year? By what amount. (20 Marks)

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