Number of units produced 2,000

Variable costs per unit:

Direct materials $21

Direct labor $75

Variable manufacturing overhead $7

Variable selling and administrative expenses $6

Fixed costs:

Fixed manufacturing overhead $116,000

Fixed selling and administrative expenses $40,000

1. Compute unit product costs under absorption costing

2. Compute unit product costs under variable costing

Racquets gloves

Sales in units 1,000 5,000

Selling price per unit $100 $40

Variable production costs per unit $20 $8

Traceable fixed production costs $20,000 $37,000

Variable selling expenses per unit $11 $2

Traceable fixed selling expenses $10,000 $23,000

Allocated division administrative expenses $6,000 $24,000

3. Compute the segment margin for the racquet division?