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High Country, Incorporated, produces and sells many recreational products. The company has just opened a new plant to produce a olding camp cot that
High Country, Incorporated, produces and sells many recreational products. The company has just opened a new plant to produce a olding camp cot that will be marketed throughout the United States. The following cost and revenue data relate to May, the first month of the plant's operation: Beginning inventory Units produced Units sold Selling price per unit Selling and administrative expenses: Variable per unit Fixed (per month) Hanufacturing costs: Direct materials cost per unit Direct labor cost per unit Variable manufacturing overhead cost per unit Fixed manufacturing overhead cost (per month) 39,000 34,000 $ 81 52 $ 559,000 $.15 59 $3 $624,000 Management is anxious to assess the profitability of the new camp cot during the month of May. Required: 1. Assume that the company uses absorption costing. a Calculate the unit product cost b. Prepare an income statement for May.
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