Bikes sell for $100 each

No units beginning inventory

Units produced 20,000

Units sold 18,000

Units in ending inventory 2,000

Variable costs per unit:

Director materials $40

Direct labor $20

Variable manufacturing overhead $5

VAriable selling and administrative $2

Field costs:

Fixed manufacturing overhead $250,000

FIxed Selling and administrative $100,000

(Fixed overhead asorbtion costing: $12.50)

A. What is the cost per bike if company uses absorption costing?

B. What is the cost per bike if company uses variable costing?