Ida Sidha Karya Company is a family-owned company located in the village of Gianyar on the island of Bali in Indonesia. The company produces a handcrafted Balinese musical instrument called a gamelan that is similar to a xylophone. The gamelans are sold for $851. Selected data for the companys operations last year follow:

Units in beginning inventory

0

Units produced

14,000

Units sold

10,000

Units in ending inventory

4,000

Variable costs per unit:

Direct materials

$ 280

Direct labor

$ 320

Variable manufacturing overhead

$ 62

Variable selling and administrative

$ 19

Fixed costs:

Fixed manufacturing overhead

$ 970,000

Fixed selling and administrative

$ 470,000

Ida Sidha Karya Company is a family-owned company located in the village of Gianyar on the island of Bali in Indonesia. The company produces a handcrafted Balinese musical instrument called a gamelan that is similar to a xylophone. The gamelans are sold for $851. Selected data for the companys operations last year follow:

Units in beginning inventory

0

Units produced

14,000

Units sold

10,000

Units in ending inventory

4,000

Variable costs per unit:

Direct materials

$ 280

Direct labor

$ 320

Variable manufacturing overhead

$ 62

Variable selling and administrative

$ 19

Fixed costs:

Fixed manufacturing overhead

$ 970,000

Fixed selling and administrative

$ 470,000

1.	Assume that the company uses absorption costing. Compute the unit product cost for one gamelan.

Unit product cost

Assume that the company uses variable costing. Compute the unit product cost for one gamelan.

Unit product cost