Item 13

Mullee Corporation produces a single product and has the following cost structure:

Number of units produced each year		7,000
Variable costs per unit:
Direct materials	$	51
Direct labor	$	12
Variable manufacturing overhead	$	2
Variable selling and administrative expense	$	5
Fixed costs per year:
Fixed manufacturing overhead	$	441,000
Fixed selling and administrative expense	$	112,000

The absorption costing unit product cost is:

Multiple Choice

• $149 per unit

• $65 per unit

• $63 per unit

• $128 per unit

13B.

A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations:

Selling price	$	88
Units in beginning inventory		0
Units produced		5,200
Units sold		4,900
Units in ending inventory		300
Variable costs per unit:
Direct materials	$	12
Direct labor	$	23
Variable manufacturing overhead	$	2
Variable selling and administrative expense	$	5
Fixed costs:
Fixed manufacturing overhead	$	161,200
Fixed selling and administrative expense	$	63,700

The total contribution margin for the month under variable costing is:

Multiple Choice

• $64,200

• $249,900

• $225,400

• $98,000

13C.

Gulinson Corporation has two divisions: Division A and Division B. Data from the most recent month appear below:

	Total Company		Division A			Division B
Sales	$	591,000	$	222,000		$	369,000
Variable expenses		275,580		113,220			162,360
Contribution margin		315,420		108,780			206,640
Traceable fixed expenses		195,000		66,000			129,000
Segment margin		120,420	$	42,780		$	77,640
Common fixed expenses		65,010
Net operating income	$	55,410

The break-even in sales dollars for Division A is closest to: (Round your intermediate calculations to 2 decimal places.)

Multiple Choice

• $134,694

• $184,531

• $487,179

• $267,367