Hilern Inc. recorded the following data for the past month: Variable costs per unit: Direct materials $4.00 Direct labour $3.20 Variable manufacturing overhead $1.00 Variable selling expenses $0.40 For the past month, fixed manufacturing overhead was $4,000 and the selling and administrative expense was $3,600. At the beginning of the month, the company had 300 units in inventory. During the month, 2,000 units were produced and 2,100 units were sold at a selling price of $14 per unit.

Required:

(A) Compute the per-unit product cost using absorption costing.

(B) What is the operating income (loss) using absorption costing?

(C) Compute the per-unit product cost using variable costing.

(D) What is the operating income (loss) using variable costing?

(E) Discuss the typical reasons why a company would have inventory on-hand.

(F) What is a Just-in-Time inventory system? Provide some examples of companies have adopted JIT and discuss possible reasons they would for using this inventory policy system?