Question
Stella's Foods produces frozen meals that it sells for $6 each. The company computes a new monthly fixed manufacturing overhead allocation rate based on the
Stella's Foods produces frozen meals that it sells for $6 each. The company computes a new monthly fixed manufacturing overhead allocation rate based on the planned number of meals to be produced that month. Assume all costs and production levels are exactly as planned. The following data are from Stella's Foods's first month in business:Units produced and sold: Sales 800 meals Production 1,100 meals Variable manufacturing cost per meal $2 Sales commission cost per meal 1 Total fixed manufacturing overhead 385 Total fixed selling and administrative costs 450 Absorption Variable costing costing Total product cost per meal
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