Question
Ida Company produces a handciafted musical instrument called a gamelan that is similar to a xylophone. The gamelans are sold for $985. Selected data for
Ida Company produces a handciafted musical instrument called a gamelan that is similar to a xylophone. The gamelans are sold for $985. Selected data for the company's operations last year follow:
Units in beginning inventory $0
Units produced 25000
Units sold 23000
Units in ending inventory 2000 Variable costs per unit:
Direct materials $300
Direct labor $480
Variable manufacturing overhead $56
Variable selling and administrative $19
Fixed costs:
Fixed manufacturing overhead $720000
Fixed selling and administrative $860000
Assume that the company uses absorption costing. Compute the unit product cost for one gamelan.
Assume that the company uses variable costing. Compute the unit product cost for one gamelan.
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