SB Exercise 6-14 through Exercise 6-15 (Algo)

Skip to question

[The following information applies to the questions displayed below.]

Chuck Wagon Grills, Incorporated, makes a single producta handmade specialty barbecue grill that it sells for $210. Data for last years operations follow:

Units in beginning inventory	0
Units produced	20,400
Units sold	19,200
Units in ending inventory	1,200
Variable costs per unit:
Direct materials	$ 50
Direct labor	80
Variable manufacturing overhead	20
Variable selling and administrative	10
Total variable cost per unit	$ 160
Fixed costs:
Fixed manufacturing overhead	$ 714,000
Fixed selling and administrative	288,000
Total fixed costs	$ 1,002,000

Required:

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

2. Assume that the company uses absorption costing. Prepare an income statement for last year.