Course: Costs and Budgeting

ABSORPTION COSTING JUST IS REQUIRED IN THIS EXERCISE. PLEASE, IT NEEDED AS SOON AS POSSIBLE

The following information is presented, absorption costing should be applied: Production (units) Sales (units) Period 1 10,000 5,000 Period 2 4,000 8,000 Period 3 8,000 8,000 The selling price per unit is $120, which has remained unchanged during the three periods. The variable cost per unit is as follows: Direct material Direct labor Manufacturing costs Selling and administrative expenses $ 18 $ 6 $ 10 $ 8 The fixed costs for each period are as follows: Manufacturing costs Selling and administrative expenses $360,000 $ 120,000 The fixed costs for each period are as follows: Manufacturing costs Selling and administrative expenses $360,000 $ 120,000 Per. 1 $ 18 $6 Per. 2 Per.3 $ 18 $18 $6 $6 Units Direct Material Direct labor Manufacturing costs $ 460,000 $ 400,000 $ 440,000 $ 46 10,000 4,000 8,000 $ 100 $55 $ 124 $ 79 $ 70 In addition, the amount of manufacturing costs for each period has been determined by considering the fixed cost of this item ($ 360,000) plus $ 10 of variable manufacturing cost for each unit manufactured. NOTE: The response should include ALL PROCEDURES and their respective results