Fairfield Corporation uses an actual cost system and produces a single product. Information about the product for the past year is as follows: Product X Production (units) 100,000 Sales (units) 80,000 Selling price $20.00 Machine hours 50,000 Manufacturing costs: Direct materials $ 80,000 Direct labor 240,000 Variable overhead 40,000 Fixed overhead 200,000 Nonmanufacturing costs: Variable selling $48,000 Fixed selling 20,000 Figure 1

-------------------------------

9. Refer to Figure 1. Calculate Fairfield's unit product cost for Product X using variable costing.

A. $4.00

B. $3.60

C. $3.20

D. $2.80

------

10. Refer to Figure 1. Calculate Fairfield's unit product cost for Product X using absorption costing

A. $5.60

B. $7.60

C. $5.00

D. $4.00

---

11. Refer to Figure 1. Determine Fairfield net income using absorption costing method.

A. $1,152,000

B. $1,044,000

C. $1,264,000

D. $1,084,000

-------

12. Refer to Figure 1. Determine Fairfield net income using variable costing method.

A. $1,264,000

B. $1,064,000

C. $1,044,000

D. $1,084,000