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Fact Pattern: The following are the estimated unit costs for a manufacturer with no beginning inventories that uses absorption costing and expects to manufacture and

Fact Pattern:

The following are the estimated unit costs for a manufacturer with no beginning inventories that uses absorption costing and expects to manufacture and sell 12,000 units per month:

Estimated

Cost Item

Unit Cost

Direct materials

$16

Direct labor

10

Variable manufacturing overhead

7.50

Fixed manufacturing overhead

3

Variable selling

1.50

Fixed selling

2

Question

Estimated monthly prime costs are

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